In Argentina, the cost of living has surged so dramatically in recent months that the government has decided to increase the denomination of its largest banknote by five times, making it 10,000 pesos, which is approximately $10.
This move by the central bank, announced on Tuesday, aims to alleviate the burden on many Argentinians who have to carry large bags or even suitcases filled with cash for everyday transactions. Argentina's annual inflation rate soared to 287% in March, ranking among the highest globally. The new 10,000 peso note, which is five times the value of the previous largest bill, is expected to be introduced next month to "facilitate transactions between users," as stated by the central bank. At the official exchange rate, the 10,000 peso note is worth $11, while at the black market rate, it's valued at $9.
Despite the introduction of the new notes, hard currency remains the preferred method of payment across Argentina, especially the 1,000-peso notes. These notes, which were introduced in 2017, were initially worth $58 on the black market but are now equivalent to just one U.S. dollar.
Argentina's President, Javier Milei, who took office in December, campaigned on a platform to combat inflation and stabilize the local currency by reversing the policies of previous left-leaning governments that printed money to finance public spending. However, his austerity measures have led to price hikes comparable to those seen in the U.S. and Europe, exacerbating the financial difficulties faced by ordinary Argentinians. A nationwide strike is planned for Thursday as part of ongoing protests against these economic challenges.
Despite Milei's optimism about the gradual slowdown in Argentina's monthly inflation rate since last December, and his belief that consumer prices can continue to decline, policymakers have reduced the central bank's key interest rate three times last month. Additionally, plans are in place to introduce an even larger bill, a 20,000-peso note, later this year.
The new 10,000-peso notes feature artistic portraits of Manuel Belgrano, a founding father of Argentina, and María Remedios del Valle, a Black Argentine woman and army captain known for her role in the country's War of Independence.