Argentine Stocks Skid; Inflation Rises Again : Economy: The austral continued to decline in relation to the U.S. dollar. Analysts said a shortage of the currency contributed to stocks’ 53% drop.

BUENOS AIRES —  Stocks on the Buenos Aires Stock Exchange plunged an average of 53% in value Monday when the market in economically wracked Argentina reopened for the first time in more than a week.

Meanwhile, the government said the inflation rate in December soared to 40%, bringing the official 1989 rise in the cost of living to a record 4,923%.

The two figures bode poorly for the government of President Carlos Saul Menem, which is implementing its fourth austerity plan since Menem came to office in July and promised to sell off inefficient state-owned industries, cut the burdensome budget deficit and steady the national currency.

But the austral, the national currency, slipped Monday against the U.S. dollar to 1,650 to 1 from 1,400 to 1 on Friday. The austral, which replaced the inflated peso, traded at parity with the U.S. dollar when the government of President Raul Alfonsin introduced it in 1986.

The sudden devaluation of the austral two weeks ago ignited the latest price hikes of 100% and more in most supermarket and department store goods. Last November, the austral traded at 1,000 to 1; in February, 17 to 1.

January inflation is expected to be at least 40% also, said Moises Iconikoff, planning secretary at the Economy Ministry.

Analysts said the fall in stock prices, the steepest in percentage since 1949 for the exchange’s 16 major companies, was in part because of the shortage of australs in circulation.

Last week, the government decreed a sharp cut in the amount of australs that would allow to be printed, to reduce supplies of the national currency and thus force up the value of the austral.

Economic indicators, however, continue to deteriorate. Real wages are about one-half their level a year ago, and investors continue to put their earnings in dollars, a traditional haven for Argentines in time of economic uncertainty. Total volume Monday on the stock exchange, as usual, was low: about $3.9 million (6.3 billion australs.)

In an economy where the rate of inflation has been triple-digit in 14 of the past 15 years, few people invest in stocks to protect their money, and few companies count on the market to raise funds.

The market, last open on Dec. 28, was closed two days for national holidays, two days by bank holidays and two days by its directors, who feared a selloff because of the austral shortage.

The independent news agency Diarios y Noticias said the stock market plunge of 53% was a “historic session that had no precedent.”

The Board of Business Wholesalers in a statement said the economic situation was “a crisis that is almost terminal,” and urged the government to cut the national budget deficit.

Inflation in 1989 was by far the worst that Argentina has experienced in recent memory. The previous record was 688% in 1984.