Mauricio Macri emulates his rival, Cristina Fernández de Kirchner

“I JUST WANT an end to the price madness,” says Sonia Valverde, a mother of three, at a supermarket in Buenos Aires. She points to a government sticker advertising new price controls, which have frozen the price of 64 products, including sachets of milk. The only difficulty is that no sachets remain on the shelf.

Ending Argentina’s price madness was Mauricio Macri’s guiding mission when he won the presidency in 2015. He lifted currency controls imposed by his populist predecessor, Cristina Fernández de Kirchner, and began to cut energy subsidies. He gave the central bank a target for inflation and let the statisticians measure it honestly. And he loosened price controls Ms Fernández had imposed on hundreds of items, including soap and chicken.

But Argentina’s maddening prices refuse to be tamed. When inflation fell less quickly than hoped, the government relaxed the central bank’s inflation target in late 2017, undermining its credibility. As American Treasury yields rose months later, the peso dropped and inflation soared. Argentina embraced the IMF and abandoned its inflation target in favour of the more direct goal of constraining the money supply. But even after the central bank promised to freeze the quantity of money until the end of this year, the peso wobbled and annual inflation soared, to almost 55% in March (...

via The Economist: Finance and economics Business Feeds

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