Argentina approved the new 20,000 and 10,000 peso bills as the hyperinflation in the South American country further worsens. On Thursday, Jan. 11, the National Institute of Statistics and Censuses (INDEC), the country's national statistics agency, released new figures.
Based on the data shared by INDEC, Argentina's annual inflation soared to 211.4% in 2023, which is considered to be the highest rate ever recorded in 32 years.
This means that Argentina's residents now need to carry more money than ever just to purchase the things they need. To solve this problem, the country's central bank approved new larger peso notes.
Argentina Approves 20K, 10K Peso Bills as Hyperinflation Rises to Over 200%!
A newsstand owner counts Argentine pesos bills in Buenos Aires on January 24, 2014. Argentina on Friday lifted restrictions in place since 2011 that limited the purchase of foreign currency, a day after the peso suffered its worst single-day dive since the 2002 financial crisis.
According to Yahoo Finance's latest report, Argentina's central bank BCRA (Banco Central de la República Argentina) approved the new 20,000 and 10,000 peso bills. BCRA said that the new larger bills would be made available as early as June.
Argentina's central bank officials explained that these new notes would make the financial system more effective.
Aside from this, they could also reduce the costs of acquiring older bills. As of writing, the largest denomination circulating in the South American country is the 2,000 peso note.
However, acquiring 2,000 bills is pretty hard since they are highly sought after by residents. With the availability of the new larger peso notes, residents' challenges when it comes to acquiring large bills could be solved.
In December 2023, the monthly inflation in Argentina reached over 25.5%. This is around 12% higher compared to the monthly inflation in November 2023.
Although this is very high, Argentina officials said that the highest monthly inflation in 2023 is still below the forecasted record, which is 30%.
Before INDEC released its figures, Argentinian President Javier Milei said that if the monthly inflation is below the forecasted record, it is still considered an achievement for them.
Read Also: Javier Milei Sworn in as Argentinian President, Warns of 'Shock Adjustment' in Economy
Argentina's Hyperinflation is Solvable, Claims President
Eggs are seen with a sign indicating their price in Argentine pesos at the Central Market in Buenos Aires on May 12, 2023. Argentina's National Institute of Statistics and Census announced that April's Consumer Price Index rate increased 8.4% compared to March.
Inquirer.Net reported that Milei still believes that Argentina's hyperinflation is solvable. During his inauguration speech, he offered a plan that could stave off hyperinflation in the country.
However, he warned that the solutions he offered would negatively affect the country at first. His plan could be painful on real wages, employment, indigent people, and poor people.
The Argentina president said that he plans to dollarize the economy once the macroeconomic variables stabilize.
"We are going to continue to see a period of inflation with horrible numbers, but then we'll see that the next step will be the fall of inflation," said Milei.
Related Article: Argentina, IMF Agree To Disburse $4.7 Billion as Javier Milei Continues To Pursue Ambitious Reforms
