UNIVERSIDAD DEL CEMA Buenos Aires Argentina Serie DOCUMENTOS DE TRABAJO Área: Economía e Historia A BRIEF HISTORY OF HYPERINFLATION IN ARGENTINA Emilio Ocampo Abril 2021 Nro. 787 www.cema.edu.ar/publicaciones/doc_trabajo.html UCEMA: Av. Córdoba 374, C1054AAP Buenos Aires, Argentina ISSN 1668-4575 (impreso), ISSN 1668-4583 (en línea) Editor: Jorge M. Streb; asistente editorial: Valeria Dowding
[email protected] A Brief History of Hyperinflation in Argentina Emilio Ocampo* Abstract A fiscal deficit of 8.5% of GDP, limited access to credit locally and internationally, country risk premiums at default levels and money supply growing at 80% annually, have led some analysts to predict that Argentina might be heading into a ―3-digit modern hyperinflation.‖ Although this opinion is not widely held, the consensus inflation forecast for 2021 is 47%, a level significantly below any definition of hyperinflation but high by global standards (above the 98th percentile). Even more worrisome, over the last decade inflation has shown a persistent upward trend and since January 2019 has averaged 45%. Given all of the above, it is worthwhile investigating when Argentina experienced it and why. This paper attempts to answer the first part of this question. According to a widely accepted view there was only one hyperinflation between 1989 and 1990. This paper argues that Argentina experienced four hyperinflationary episodes that were part of a long-term cycle that started in 1945. Keywords: Argentina, Inflation, Extreme Inflation, Hyperinflation. JEL Codes: E31, N16 Resumen Un déficit fiscal de 8,5% del PBI, acceso limitado al crédito local e internacional, una prima de riesgo país que implica una alta probabilidad de cesación de pagos y una oferta monetaria que crece a una tasa anual de 80%, han llevado a algunos analistas a sostener que la Argentina se encamina a una "hiperinflación moderna de 3 dígitos".