The benchmark interest rate in Argentina was last recorded at 32 percent. This dataset provides the latest reported value for - Argentina Money Market Rate - plus previous releases, historical high and low, short-term forecast and long-term prediction, economic calendar, survey consensus and news.

Argentina is by far the Latin American country with the highest monetary policy rate as of 2018. Monetary policy rate, also known as base interest rate or base rate, is a percentage defined by central banks to determine the cost of credit in a given economy. This indicator serves as a guide for other financial institutions to set their own interest rates. The base interest rate defined by Argentina's Central Bank more than doubled from 12.25 percent in 2010 to 26.42 percent in 2017.

Key information about Argentina Policy Rate

• Argentina cash rate (Interest Rate: Financial Institution Deposit: 30 Days) was set at 27.74 % in Feb 2025, compared with 28.72 % in the previous Jan 2025.
• Argentina Policy Rate averaged 17.09 % and is updated monthly, available from Jan 1985 to Feb 2025.
• The data reached an all-time high of 1,010.56 % in May 1989 and a record low of 0.00 % in Jul 1990.

Related information about Argentina Policy Rate

• In the latest reports, Argentina Short Term Interest Rate: Month End: Argentina: Up to 15 Days Interbank Call Rate (BAIBAR) was reported at 31.80 % pa in Jul 2021.
• Argentina Exchange Rate against USD averaged 254.03 (USD/ARS) in Jun 2023.
• Its Real Effective Exchange Rate was 50.18 in Feb 2025.

Inflation in Argentina was 54 percent in 2019, before falling to 42 percent in 2020. Despite Argentina's fluctuating economic instability over the twentieth century, the largest factor in its current economic status is the legacy of poor fiscal discipline left by the economic depression from 1998 to 2002. Although data is not available from 2014 to 2016, Argentina's inflation rate has been among the highest in the world for the past five years.

What causes inflation?

Inflation is a rise in price levels for all goods. Major causes of inflation include an increase in money supply, low central bank interest rates, and expectation of inflation. In a country such as Argentina, the expectation can be one of the biggest obstacles. People expect inflation to be high and demand increasing wages, and firms continue raising prices because they expect the costs of inputs to increase. Banks follow suit, charging high interest rates on fixed deposits.

Effects of inflation

Inflation negatively affects savers. 100 Argentinian pesos in 2018 was worth just under 75 pesos in 2019, after adjusting for the 34 percent inflation rate. Similarly, frequently changing prices has its own inherent cost, called “menu cost” after the price of printing new menus. Inflation will also have a positive effect on national debt when that debt is denominated in Argentinian pesos, because the pesos will be cheaper when the loan matures. However, the majority of Argentina’s debts are in foreign currency, which means that inflation will make these debts larger in peso terms.

Inflation Rate in Argentina decreased to 66.90 percent in February from 84.50 percent in January of 2025. This dataset provides the latest reported value for - Argentina Inflation Rate - plus previous releases, historical high and low, short-term forecast and long-term prediction, economic calendar, survey consensus and news.

Among the Latin American and Caribbean countries shown in this graph, Argentina had the highest monetary policy rate as of 2018. The monetary policy rate, also known as base interest rate or base rate, is a percentage defined by central banks to determine the cost of credit in a given economy. This indicator serves as a guide for other financial institutions to set their own interest rates. In 2017, the latest year with available data according to the source, Argentina's Central Bank set the monetary policy rate at 26.42 percent. In 2018, the base interest rate in Mexico stood at 7.64 percent.

Key information about Argentina Real Effective Exchange Rate

• Argentina Real Effective Exchange Rate (REER: 2005=100: Month Avg: Argentina) was 49.3 in Jan 2025, compared with the number of 49.4 in the previous month.
• Argentina Real Effective Exchange Rate data is updated monthly and averaged 123.1 from Jan 1997 to Jan 2025.
• The data reached an all-time high of 123.1 in Jun 2002 and a record low of 41.1 in Oct 2001.

CEIC generates Real Effective Exchange Rate Index with base 2005=100. The Central Bank of Argentina provides Real Effective Exchange Rate Index with base 17 December 2015=100. CPI is used as a deflator. An increase in REER indicates reduced competitiveness for the reporting economy.


Related information about Argentina Real Effective Exchange Rate

• In the latest reports, Argentina Short Term Interest Rate: Month End: Argentina: Up to 15 Days Interbank Call Rate (BAIBAR) was reported at 31.8 % pa in Jul 2021.
• The cash rate (Interest Rate: Financial Institution Deposit: 30 Days) was set at 28.7 % in Jan 2025.
• Argentina Exchange Rate against USD averaged 254.0 (USD/ARS) in Jun 2023.

The Consumer Price Index gauges the price changes in a basket of goods and services in a defined time period. In Argentina, the CPI in April 2024 was 289 percent higher than the one registered the same month of the previous year, with this figure being the largest monthly inflation rate since, at least, the beginning of 2018. The Argentinian inflation rate has been experiencing a steep increase from December 2020 onwards, when the decreasing trend witnessed since December 2019 came to an end. Long history of inflation in Latin America High inflation rates are nothing new in Latin America. In 2023, the region's inflation rate was 14.41 percent, while the global average was much lower at 6.78 percent. Nonetheless, the main drivers of this are Venezuela and Argentina, both being in the upper table of countries with the highest inflation rates in the world. During the last few years, Venezuela entered a period with five-digits inflation rates, having to issue a new currency and implementing new policies to control price increases.

A history of hyperinflation During the last couple of years, inflation has been a constant among the main problems the Argentine society faces. The country returned to a three-digit inflation rate with former president Alberto Fernández, and the constant price increases took a toll on households across the board. Nevertheless, the problem is far from a recent one or the worst it's ever been, in 1989 and 1990, the inflation rate was over 2,000 percent, reaching for the status of hyperinflation. Commonly, hyperinflation is defined as price increases with over 50 percent per month.

The Consumer Price Index gauges the price changes in a basket of goods and services in a defined time period. During August 2024, the product category with the highest Consumer Price Index (CPI) increase compared with the previous month in Argentina was household, water, electricity, gas and other fuels with a seven percent increase. Followed by education with a 6.6 percent increase. Nonetheless, when compared with the previous year, communications registered the highest price increase with over 320 percent year-over-year. The expectation of inflation Despite Argentina’s efforts to reduce inflation, the country ranks in the top three Latin American countries with the highest rate, only with a lower figure than Venezuela and Suriname. The situation is not a recent one, the inflation rate has been reaching double digits every year since 2012, reaching over 50 percent in 2019, making the constant rising prices nothing out of the ordinary for Argentinian families. The expectation of inflation is one of the main causes of inflation with low central bank interest-rates and increases in the money supply, which helps to explain the chronic inflation of the country. Both firms and people expect inflation in their lives, workers demand increasing wages to coop with inflation, while companies increase prices of goods and services because they expect production costs to grow, creating a vicious circle in the economy. Inflation and poverty Inflation negatively affects consumers and savers alike. For the latter, 100 Argentinian pesos in 2020 was worth just under 52 pesos in 2021, after adjusting for the 48.41 percent inflation rate. For the consumers, rising prices of the basic products increase the vulnerability of the population. In January 2023, the value of the basic food basket, which establishes the extreme poverty line, stood at 23,315 pesos, more than ten times higher than during the same month in 2018. Between the first half of 2018 and the first half of 2022, the share of households under the poverty line increased by over 8 percentage points reaching 27.7 percent.

Abstract

The Survey on Interest Rate Controls 2020 was conducted as a World Bank Group study on interest rate controls (IRCs) in lending and deposit markets around the world. The study aims to identify the different types of formal (or de jure) controls, the countries that apply then, how they implement them, and the reasons for doing so. The objective of the study is to advance knowledge on this topic by providing an evidence base for investigating the impact of IRCs on economic outcomes.

The survey investigates present IRCs in each surveyed country, the reasons why they have been applied, the framework and resources associated with their application and the details as to their level and functioning. The focus is on legal forms of control (i.e. codified into law) as opposed to de facto controls. The new database on interest rate controls, a popular form of financial repression is based on a survey of 108 countries, representing 88 percent of global gross domestic product. The interest rate controls presented in this dataset were in effect in 2019.

Geographic coverage

Global Survey, covering 108 countries, representing 88 percent of global GDP.

Analysis unit

Regulation at the national level.

Universe

Banking supervisors and Local Banking Associations.

Kind of data

Sample survey data [ssd]

Mode of data collection

Mail Questionnaire [mail]

Research instrument

Bank supervisors and banking associations were provided with a standard excel file with five parts. The survey was structured in five parts, each placed in a different excel sheet. Part A: Introduction. Countries with no IRCs in place were asked to only answer this sheet and leave the rest blank. Part B: Presented the definitions of controls, institutions, products and additional aspects that will be covered in the survey. Part C: Introduced a set of qualitative questions to describe the IRCs in place. Part D: Displayed a set of tables to quantitatively describe the IRCs in place. Part E: Laid out the final set of questions, covering sanctions and control mechanisms that support the IRCs' enforcement. The questionnaire is provided in the Documentation section in pdf and excel.

The ratio of national debt to gross domestic product (GDP) in Argentina was forecast to continuously decrease between 2024 and 2029 by in total 40 percentage points. After the sixth consecutive decreasing year, the ratio is estimated to reach 51.5 percent and therefore a new minimum in 2029. Depicted here is the general government gross debt in relation to the country's GDP. According to the International Monetary Fund, gross debt consists of all liabilities that require payment or payments of interest and/or principal by the debtor to the creditor at a date or dates in the future. The GDP, on the other hand, refers to the total value of final goods and services produced during a year.Find more key insights for the ratio of national debt to gross domestic product (GDP) in countries like Paraguay, Uruguay, and Chile.

As of August 2023, the country with the highest deposit interest rate worldwide was Argentina, where the interest rate was as high as 113 percent. Second in the list came an African country, Zimbabwe, where the interest rate reached 110 percent.

The Emerging Markets Bond Index (EMBI), commonly known as "riesgo país" in Spanish speaking countries, is a weighted financial benchmark that measures the interest rates paid each day by a selected portfolio of government bonds from emerging countries. It is measured in base points, which reflect the difference between the return rates paid by emerging countries' government bonds and those offered by U.S. Treasury bills. This difference is defined as "spread". Which Latin American country has the highest risk bonds? As of September 19, 2024, Venezuela was the Latin American country with the greatest financial risk and highest expected returns of government bonds, with an EMBI spread of around 254 percent. This means that the annual interest rates paid by Venezuela's sovereign debt titles were estimated to be exponentially higher than those offered by the U.S. Treasury. On the other hand, Brazil's EMBI reached 207 index points at the end of August 2023. In 2023, Venezuela also had the highest average EMBI in Latin America, exceeding 40,000 base points. The impact of COVID-19 on emerging market bonds The economic crisis spawned by the coronavirus pandemic heavily affected the financial market's estimated risks of emerging governmental bonds. For instance, as of June 30, 2020, Argentina's EMBI spread had increased more than four percentage points in comparison to January 30, 2020. All the Latin American economies measured saw a significant increase of the EMBI spread in the first half of the year.

As of December 30, 2024, the major economy with the highest yield on 10-year government bonds was Turkey, with a yield of 27.38 percent. This is due to the risks investors take when investing in Turkey, notably due to high inflation rates potentially eradicating any profits made when using a foreign currency to investing in securities denominated in Turkish lira. Of the major developed economies, United States had one the highest yield on 10-year government bonds at this time with 4.59 percent, while Switzerland had the lowest at 0.27 percent. How does inflation influence the yields of government bonds? Inflation reduces purchasing power over time. Due to this, investors seek higher returns to offset the anticipated decrease in purchasing power resulting from rapid price rises. In countries with high inflation, government bond yields often incorporate investor expectations and risk premiums, resulting in comparatively higher rates offered by these bonds. Why are government bond rates significant? Government bond rates are an important indicator of financial markets, serving as a benchmark for borrowing costs, interest rates, and investor sentiment. They affect the cost of government borrowing, influence the price of various financial instruments, and serve as a reflection of expectations regarding inflation and economic growth. For instance, in financial analysis and investing, people often use the 10-year U.S. government bond rates as a proxy for the longer-term risk-free rate.

In 2023, no Latin American or Caribbean country registered deflation in their average consumer prices. Costa Rica had the lowest change compared to the previous year with 0.52 percent. In contrast, the average inflation rate in Venezuela amounted to about 337.46 percent.

Latin America among the highest inflation rates in the world In 2023, the average inflation rate of the region was around 14.41 percent. Which is significantly higher than the global average of 6.78 percent. Some of that is explained by countries such as Venezuela, Argentina, and Suriname ranking in the top then of countries with the highest inflation rate in the world.

Chronic inflation in Latin America Chronic inflation is often defined as persistent high inflation throughout a long time. Some of the common examples of this problem are Venezuela and Argentina, both countries had episodes of hyperinflation, with price increases considerably over 50 percent per month in both cases. The last few years, the global crisis and economic sanctions, attenuated the situation with Argentina reaching once again three-digit inflation and Venezuela exceeding 63,000 percent inflation in 2019.

At the end of 2023, Zimbabwe had the highest inflation rate in the world, at 667.36 percent change compared to the previous year. Inflation in industrialized and in emerging countries Higher inflation rates are more present in less developed economies, as they often lack a sufficient central banking system, which in turn results in the manipulation of currency to achieve short term economic goals. Thus, interest rates increase while the general economic situation remains constant. In more developed economies and in the prime emerging markets, the inflation rate does not fluctuate as sporadically. Additionally, the majority of countries that maintained the lowest inflation rate compared to previous years are primarily oil producers or small island independent states. These countries experienced deflation, which occurs when the inflation rate falls below zero; this may happen for a variety of factors, such as a shift in supply or demand of goods and services, or an outflow of capital.