Argentina’s central bank hiked the benchmark interest rate a sharper-than-expected 300 basis points on Thursday after inflation soared past expectations in March to hit 104% on an annual basis, the monetary authority said in a statement.Reuters earlier reported, citing an official source, that the board had decided to raise the reference rate to 81% from its previous 78% level after March inflation data had clocked in at 7.7%, the highest monthly level in two decades.

The hike extends a new round of tightening by Argentina’s central bank, which is fighting soaring prices and dwindling foreign currency reserves, while the peso currency has hit record lows against the dollar in parallel markets. Drought has battered exports of the country’s main cash crops soy and corn.The bank hiked the benchmark rate 300 basis points in March, the first raise since September at the end of a vicious tightening cycle through most of 2022.

The bank had wanted to cut rates this year on hopes inflation would cool.Inflation, however, has gained pace again, driving poverty levels to near 40% and hurting the Peronist government of President Alberto Fernandez, which lags the conservative opposition in public opinion polls ahead of October elections.