Argentina Central Bank Hikes Rates to Whopping 69.5 Percent as Country Fights Soaring Inflation

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The Central Bank of the Argentine Republic (BCRA) raised its 28-day benchmark interest rate by 950 basis points on Aug. 11, pushing up the rate to 69.5 percent.

“The rise in the policy rate will help reduce inflation expectations for the rest of the year and consolidate the financial and exchange rate stability achieved after the disruptive events of the last two months that led to the intervention of the BCRA in the secondary securities market,” the central bank said in an Aug. 11 press release.

This is the eighth policy rate hike implemented by the BCRA this year and follows the 800-basis point hike announced two weeks back. The hikes come as the country’s inflation rose by 7.4 percent in July, pushing up the annual inflation to a two-decade high of 71 percent.

The inflation crisis resulted in the resignation of the country’s finance minister Martin Guzman in July. His replacement Silvina Batakis, who assumed Guzman’s post on July 4, was then ousted a month later on Aug. 3.

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