Some retailers in Argentina are already pricing imported items in US dollars, according to local media reports. The idea behind this would be to keep prices stable and avoid revaluing items every day, a practice that has already been adopted in other Latam countries such as Venezuela, which have high levels of inflation.
US dollars are now used to price goods in Argentina
The US dollar begins to enter Argentina as a unit of account. According to reports from local outlets, some Argentine stores and retailers set the prices of their products in dollars, seeking to avoid constant price revisions due to the devaluation of the national fiat currency, the Argentine peso.
According reports of La Nación, these prices are mostly associated with clothing, including branded shoes, t-shirts and caps, which are mostly imported from other countries. However, to purchase these items, customers can also pay with Argentine pesos, using the informal exchange rate, called “blue”, as a reference to calculate the final price in local currency.
Alfredo González, president of the Argentine Confederation of SMEs, explains that suppliers are also setting their prices in dollars when it comes to imported items. On this, he stated:
It is very difficult to survive with these levels of inflation. We have a hard time getting merchandise, price lists are updated at least every two weeks. It is difficult to obtain the reference values for some particular products. We are very concerned and busy with the issue.
Other Incidents and New Measures
Other countries have also adopted this type of practice in Latam, due to the same economic disadvantages that Argentina now faces. Although Venezuela is not an officially dollarized country, since it has its own fiat currency, the Venezuelan bolivar, most merchants use the dollar as the unit of account for pricing.
However, in Venezuela, retailers already price even the most basic products in dollars. In contrast, this trend is just beginning to appear in selected points of sale in Argentina. The Venezuelan government has redenominated its currency several times, removing zeros to maintain its efficient use to make payments in the face of a crippling devaluation.
Argentina is looking for ways to control its inflation levels, which reached almost 100% in 2022, and the devaluation of its fiat currency, which has led the central bank to issue new notes with higher values. Alberto Fernández, the Argentine president, recently reported on a joint initiative by several LatAm countries to combat inflation that would be defined at a summit on March 17.
What do you think about the appearance of items at dollar prices in Argentina? Tell us in the comment section below.
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