MercoPress. South Atlantic News Agency
The US dollar stronger than the Euro in Argentina’s parallel market
Argentines traditionally take refuge in the US dollar For the second day running the Argentine Peso weakened against the US dollar climbing half a cent from Monday and closing at 4.43 and 4.48 on the local foreign exchange market.
This happened as Argentina’s tax revenue office, AFIP continued with strict controls and restrictions on the purchase of foreign currency which further widened the gap between the official and parallel or black market rate.
In effect in the black market the US currency was up eight cents and closed trading on Tuesday at 5.94 Pesos, surpassing the Euro which closed at 5.80 Pesos.
Argentine Central bank sources quoted by the Buenos Aires financial media said that the surge can be explained by a “general hysteria feeling that has trapped the market with an over reaction from agents”.
Furthermore the volumes traded in the parallel or black market are very low and are “highly volatile to the minimum changes”.
“The formal market is totally under control and in line with government policy, but the parallel has become a problem since it sparks psychological pressure”, added Buenos Aires market sources.
Meanwhile in the foreign exchange wholesale market the dollar climbed to 4.475 Pesos from 4.4655 Pesos on Monday.
Brokerage houses reported that the Central bank ended Tuesday as a net buyer of 15 million dollars with an overall turnover of 374 million dollars.
The central bank regularly intervenes in the foreign-exchange market to buy dollars to build its international reserves and keep the Peso on a slow path of depreciation against the greenback to help exporters.
So far in May the Central bank has purchased over 800 million dollars while in the first four and a half months of 2012, they add up to 6.15 billion dollars.
Top Comments
Disclaimer & comment rules-
-
-
Read all commentsBA Real Estate and New Construction has collapsed! It is down 30%! Exports are down 14% yoy!
May 23rd, 2012 - 12:22 pm 0Healthcare professionals are complaining they are out of gloves, syringes, inhalers (So CFK i literally killing asthmatics!), various medications are all unavailable!
All the misguided policies of the Ks last 8 years are coming home to roost.
When will the people rise up?
I think soon....
Well, if CFK was that clever, she would rush to join the EURO quickly before the doors close,
May 23rd, 2012 - 01:00 pm 0you don’t have to be in Europe to join, as long as you have the money, they will supply you with the membership .lol
6/1 was reached today in Palermo right before AFIP shut down the exchange house!
May 23rd, 2012 - 03:09 pm 0I can't believe CFK is stupid enough to think they can control the exchange price with police/state action. It will never work and it will only make it worse.
This will create panic it just needs a spark to set if off...
Commenting for this story is now closed.
If you have a Facebook account, become a fan and comment on our Facebook Page!