Argentina has once again imposed price controls on nearly 60 products, including food items, in a desperate bid to contain inflation spiraling out of control amid growing volatility in the currency market.
The government has also promised that it would no longer increase prices for electricity, cooking gas and public transport for the rest of this year.
The price controls apply to around 60 products, but are less likely to tame inflation, as they do not seem to resolve underlying problems. Prices have increased by 55% over the past year alone, leaving many people unable to purchase many basic goods.
“They are measures that we have taken to provide relief,” President Mauricio Macri said in a video broadcast. “We are not using short-cuts or magical solutions, but in the short-term it will be tough.”
Analysts say the measure is aimed at soothing people’s anger, as Macri is seeking re-election in October. Pre-poll surveys are predicting a victory for Cristina Fernández de Kirchner, but whose economic measures are also blamed for the country’s financial crisis.
The latest measure is a sign that Argentina’s economic woes are proving hard to fix, with the stock market falling and last year’s drought continuing to wreak havoc in parts of the country.
Macri’s efforts to rebalance the economy hit an obstacle last year when the Argentine peso lost half its value as a result of rising interest rates in the United States.
The dramatic fall fueled inflation, forcing Argentina to seek a US$56.3 billion bailout from the IMF.