Buenos Aires, Argentina — In times like these in Argentina, prices are one thing you cannot guarantee.

Ask Diego Barrera and Claudio Cayeta, who own a small aluminum and glass shop in the Buenos Aires neighbourhood of Palermo. The business partners spent two weeks last month navigating a virtual paralysis because of the volatile economic situation gripping the country, unable to source the material they needed, and as a result unable to quote prices to their customers.

“Our providers won’t give us anything because the [United States] dollar goes up every day, so they don’t want to lose money,” said Barrera, 43, whose stock has dwindled as the uncertainty around them climbs.

“I understand because the same thing happens to me,” he said. “I’ve already lost money on the prices that I quoted some of my customers.”

This reality has become alarmingly common in Argentina, with its economy unravelling at an accelerating rate. The rising value of the US dollar is actually a measure of the plummeting value of the Argentinian peso, which sank by as much as 25 percent on the black market over the month of April. On April 25 it hit a record low, grazing 500 pesos for one US dollar at the unofficial rate, the one that is most often used as a benchmark for average Argentinians because currency controls limit how much they can buy at the official exchange rate.

With inflation at more than 104 percent over the last 12 months, according to official statistics, it is increasingly difficult to know what anything is worth, let alone budget for everyday items. Food prices alone jumped an average of 10 percent in March over the previous month in the Greater Buenos Aires region — fruits and vegetables around 15 percent; eggs 25 percent.

Raw materials, like the ones Barrera and Cayeta work with, are also impossible to predict, because the prices rise and fall with the value of the currency. The price of glass went up 10 percent mid April, said Barrera, and his provider advised him of a second increase by the same amount two weeks later.

All of this has fuelled a climate of political instability during an election year. The deeply unpopular President Alberto Fernandez formally announced he would not seek re-election, and later blamed the depreciating currency on rumours and speculation driven by right-wing politicians.

In a tweet, Economy Minister Sergio Massa said he would use “all the tools of the state to order this situation”, and that included redefining the terms of a controversial agreement with the International Monetary Fund (IMF) to pay back a $44bn loan.

After the Central Bank of Argentina intervened and traded bonds on April 25, a move contrary to its agreement with the IMF, the unofficial exchange rate plummeted to 460 pesos per one US dollar. Argentina also announced that it would start to pay imports from China with the yuan, rather than the dollar, a move that will help safeguard its greenback reserves. (Al Jazeera)

•PHOTO: Soaring inflation and a plummeting Argentinian peso are fuelling a climate of political instability in an election year in Argentina [File: Natacha Pisarenko/AP Photo]

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