Argentina's peso continues its slide to lows not seen for decades

Transcript

STEVE INSKEEP, HOST:

People worried about inflation in the United States should be careful about complaining to anybody from Argentina. The U.S. dollar has lost some of its value in the past year or two, of course. But the Argentine peso has collapsed. And you can see that in its relative value to the dollar. One year ago, by official rates, you needed around 100 pesos to buy one U.S. dollar, now it's over 200. And if you trade for dollars on the black market, as people often have to do, you would need 500 pesos for a dollar. NPR's Carrie Kahn is in Buenos Aires, where the currency loses value by the hour.

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CARRIE KAHN, BYLINE: Downtown, pedestrians weave among sidewalk vendors and chalkboard stands outside stores. These days, with prices changing by the hour, it's easier to erase than reprint menus and signs. Some vendors say they're changing prices three times a day just to keep up with the plunging peso.

UNIDENTIFIED PERSON #1: (Speaking Spanish).

KAHN: Dollar changers try to lure tourists with crisp 100 bills. Argentines come here, too, many straight from nearby banks on payday to ditch their pesos into safe dollars.

JUAN LUIS BOUR: We do not trust in our currency like other countries do.

KAHN: Economist Juan Luis Bour says confidence has hit rock bottom. The peso has lost 20% of its value just since the first of the year. The black market price is more than double the government's fixed rate. And inflation has soared past 100%.

UNIDENTIFIED PERSON #2: (Speaking Spanish).

KAHN: Hawking fresh bread from his metal shopping cart, a man zigzags down the potholed streets of one of Buenos Aires' largest slums, known as Villa 21-24, on the outskirts of the capital. It's a juggling act to survive here, says Ana Vasquez (ph), waiting for church to start.

ANA VASQUEZ: (Speaking Spanish).

KAHN: "You barely make it to the end of the month - always juggling, paying back a loan here, working this job there, selling this or that," she says.

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UNIDENTIFIED SINGER: (Singing in Spanish).

VASQUEZ: (Singing in Spanish).

UNIDENTIFIED SINGER: (Singing in Spanish).

VASQUEZ: (Singing in Spanish).

KAHN: Poverty is on the rise. Forty percent of Argentines are now poor. Priest Lorenzo De Vedia (ph), known by everyone as Padre Toto (ph), says he's had to open more and more soup kitchens.

PADRE TOTO: (Speaking Spanish).

KAHN: "It used to be helping people make it to the end of the month. Now it's just from day to day," he says. Critics say the government refuses to deal with the crisis and must cut runaway government spending by the leftists in power. Current President Alberto Fernandez says he won't sacrifice people's welfare. He says he was handed a country buried in debt four years ago. And he blames the recent plunge in the peso on the right.

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PRESIDENT ALBERTO FERNANDEZ: (Speaking Spanish).

KAHN: "This is what they do. They start off in the morning spreading rumors, keep them going all day and make money off manipulating the dollar," he said this week. Fernandez just announced he won't be running for reelection. Presidential elections are slated for October. And it's unlikely the government will devalue the peso before then. But dollar reserves are dropping. And many economists predict they might not be able to hold off much longer.

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KAHN: A vendor sweeps up after a farmer's market in Buenos Aires' well-to-do Palermo neighborhood. Thirty-four-year-old Micaiella (ph) waits to take whatever isn't sold. She would only give her first name, fearful of police retribution. She sleeps in the park with her kids, who help her pick up recycling.

MICAIELLA: (Speaking Spanish).

KAHN: She says she just feels like everything these days is going backward, and no one has a plan to move Argentina forward.

Carrie Kahn, NPR News, Buenos Aires.

(SOUNDBITE OF GOTAN PROJECT SONG, "ARRABAL") Transcript provided by NPR, Copyright NPR.