Argentina to Hike Rates in Bid to Stem Inflation Crisis
- Key rate to reach 97%, policymakers to boost peso intervention
- Inflation sped up to 109% as currency weakens before election
The Central Bank of Argentina in the financial district of Buenos Aires, Argentina.
Photographer: Sarah Pabst/BloombergArgentina will unveil a set of emergency measures in a bid to stem additional currency losses, including a large increase to its key interest rate, as inflation spirals out of control in the run up to presidential elections, according to officials at the Economy Ministry and the central bank.
The monetary authority will raise its benchmark rate by 600 basis points to 97% on Monday while boosting intervention in the foreign exchange market, the officials said, asking not to be named before measures are formally announced by Economy Minister Sergio Massa. Policymakers are struggling to contain a selloff in the peso, which in parallel markets has lost 35% of its value against the dollar so far this year.