After the dollar-loving Milei wins the presidency, Argentines anxiously watch the exchange rate

The exchange rate of the peso with the U.S. dollar has become a widely watched barometer of the nation’s economic health, and is top of mind for millions of Argentines coping with triple-digit inflation. Knowing a further depreciation of the peso will boost the price of consumer goods, they are anxious for signs of what Milei’s victory on Sunday meant for the value of the currency that has tanked against the U.S. dollar in the past year.

Inflation is running at an annual rate of more than 140%. Uncertainty about prices was rampant this campaign season, with many Argentines stocking up on goods and lining up at gas stations to beat potential post-election price increases. On Tuesday morning, local media were reporting that wholesalers were sharply increasing prices.

Prices are pushed higher by a weaker currency that makes imports more expensive. Milei, an outsider and right-wing populist, has also accused the Central Bank of recklessly printing money in order to fund public spending. Inflation is a chief reason voters elected Milei, who promised drastic measures to curb price hikes including deep public spending cuts and dollarization of the economy.

The morning after his victory, Milei told Radio Mitre that inflation is so entrenched it could take him as much as half his four-year term to fix.

An existing government program forces major supermarket chains to keep prices of certain basic goods roughly one-third below their market value to minimize inflation’s impact on consumers. Still, price increases are common.

On Monday, a national holiday, many clients in one such market stocked up on nonperishables — tuna, water, pasta — in anticipation of a post-election surge, said its manager, Javier, who declined to provide his last name because he was not authorized to speak publicly. The next morning, his market raised prices somewhat for basic goods including milk, butter cheese and pasta.

Milei, a self-described anarcho capitalist, has said he will abolish the Central Bank and has promoted replacing the local currency with the dollar to rein in inflation. He associated his campaign so closely with the idea that supporters at rallies carried giant 100-dollar bills bearing his face.