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Montevideo, September 24th 2018 - 02:00 UTC

Argentina lifts foreign currency controls and let's Peso float, as of Thursday

Thursday, December 17th 2015 - 06:50 UTC
Full article 37 comments

Argentina announced on Wednesday it was lifting currency controls and would allow the peso to float when markets open on Thursday, setting the stage for a devaluation, following pledges by new president Mauricio Macri for reforms to spur economic growth. Read full article

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  • Skip

    14.2 pesos...... it might bounce around but I don't expect it to go to much lower than that.

    Will be interesting to see what happens in 4 hours.

    Dec 17th, 2015 - 08:04 am - Link - Report abuse 0
  • Troy Tempest

    @1

    You mean when NY trading starts ?

    Dec 17th, 2015 - 08:32 am - Link - Report abuse 0
  • Skip

    9am in BsAs, Troy

    I'm thinking that will have the greatest effect as the Argentinean public are the largest market holding pesos and wanting US dollars.

    Dec 17th, 2015 - 09:02 am - Link - Report abuse 0
  • Troy Tempest

    Thx Skip

    BubbleAR has some interesting stories about Macri and his reforms - and the fear and K organized “spontaneous” protests by gov workers .

    Macri was about to fire 2-3000 of the “noquis” working in the Congress alone, as unneeded and surplus staff.

    If they are like Enrique, they are all predicting a massive devaluation.

    Dec 17th, 2015 - 09:13 am - Link - Report abuse 0
  • ChrisR

    Ballsy move and at exactly the right time.

    We all want Argentina to get out of the mire that the K's made and it seems so dose the western finance houses.

    I have no idea at all how far the ARG Pesos will drop but with all the printing done by the K's it's going to be a rocky ride for a few weeks.

    Another good move by Macri's team.

    Dec 17th, 2015 - 10:49 am - Link - Report abuse 0
  • Demantoid Garnet

    @5 Agreed.

    It has to happen, and with the international financial community being supportive of Argentina's move back into the trading world... the timing is as good as it going to get.

    Sure, there will be impacts and adjustments impacting importing / exporting, but it has been SO restricted in the past that whole new opportunities and goods will now become available.

    Best wishes everyone.

    Dec 17th, 2015 - 11:28 am - Link - Report abuse 0
  • ElaineB

    Macri is staying true to previous form. He never shied away from dealing with the “noquis”.

    Dec 17th, 2015 - 11:37 am - Link - Report abuse 0
  • Marti Llazo

    Media this morning showing free trading of ARS went from the original controlled rate of 9.84 on Wednesday to essentially the Blue Dollar rate of 15 ARS to the dollar, and then later backed down to about 14.5 ARS/ dollar. That's effectively a very significant devaluation, and a recognition that the ARS was insanely but artificially overvalued, by about 40 percent.

    Dec 17th, 2015 - 01:59 pm - Link - Report abuse 0
  • ElaineB

    All the money they wasted artificially inflating the value.

    Dec 17th, 2015 - 02:06 pm - Link - Report abuse 0
  • Tarquin Fin

    @7
    My own personal estimation is that about 13,000 ñoquis should be “evicted” in the next 3 months. This would be the first batch and only includes the ministries 'main buildings downtown.

    Unfortunately, the new administration will only be able to get rid of ñoquis in a hiena style, two steps forward, one step backwards. La Campora and ATE (biggest public workers' union) will conduct protests, at least once a week trying to show the “People's” rejection to the new president of evil.
    This will be an

    Dec 17th, 2015 - 02:12 pm - Link - Report abuse 0
  • Troy Tempest

    Tarquin continue

    Dec 17th, 2015 - 05:10 pm - Link - Report abuse 0
  • Klingon

    The noose is tightening on Kristina. A judge just fired the useless prosecutor in the Nisman case and they are chasing down the stolen loot. http://www.buenosairesherald.com/article/205102/eximf-official-to-head-moneylaundering-unit

    Dec 17th, 2015 - 05:19 pm - Link - Report abuse 0
  • Zaphod102

    I think you are correct, but does she realise that? 12 years of arrogance and immunity are maybe too much of a habit to break until it is too late?

    The crowd of people who gathered when she arrived at her home in Recoleta chanting “Thief thief...” would be a clue but would she pay any attention to it?

    She's probably caught between doing a runner and staying and trying to rebuild to come back in 4 years time. It is game theory. If she leaves then she's finished politically but may be able to enjoy her wealth for a while. If she stays and is imprisoned then she loses both. If she stays and isn't imprisoned then there is a chance of a win-win for her. Therefore it all depends on the probability of imprisonment. At the moment she obviously judges this to be sufficiently low to be worth the risk of staying, but as investigations continue the probability can only rise. The question therefore is at what point does she decide she has to run vs. at what point the authorities decide that there is enough evidence to prevent her from leaving Argentina (as they'd done with Boudou)? You'd hope that the authorities wouldn't communicate the progress of their investigations until the point of arrest so she could be caught by surprise, but she probably has spies so we shall see... A sudden unexpected tightening of the noose would concentrate her mind somewhat. The stakes are high for her. This will be an interesting one to watch...

    Dec 17th, 2015 - 06:13 pm - Link - Report abuse 0
  • Troy Tempest

    Wow!!

    Very exciting!!

    Dec 17th, 2015 - 06:41 pm - Link - Report abuse 0
  • Skip

    Klingon

    They don't even have to charge CFK (though it would be great if they did) because all they need to do is create guilt by association so she becomes a poisoned chalice for the next election.

    Anyone know where the exchange rate settled to? Roughly the blue dollar rate I'm guessing. If so, I reckon will start to stregthen slightly over the next year as panic buying and hedging by consumers drops when the inflation rate drops (whatever it officially works out to be).

    Dec 17th, 2015 - 07:40 pm - Link - Report abuse 0
  • ChrisR

    @ 15 Skip

    As of 16.04 hours:
    Blue 14.21 / 14.36

    Official 13.75 /13.95

    “Roughly the blue dollar rate” not a bad call!

    Dec 17th, 2015 - 08:10 pm - Link - Report abuse 0
  • Skip

    ChrisR

    The market knows. Hehe. So I can't claim too much credit. I expect it will be a bit stronger than the blue which would obviously have a margin built in due to the restrictions.

    However a prediction based on the hope I have for Macri would see a rate closer to 9 than 14 by the next election. Just having legitimate economic statistics will help that let alone any resultant boom from reforms.

    Dec 17th, 2015 - 08:28 pm - Link - Report abuse 0
  • shackleton

    IMO - its got a way to go down yet. The dolar blue hit 15 back in Oct 2014 and, since there's been at least 30% inflation since then, it should therefore be about 20 now. OK, lest say it overshot by 10%, that still signals 18 to $. Also, if one compares prices of goods with a very similar economy (South Africa) - at the present rate of 14 to 1, Argentina is still about 15-20% more expensive. My gut feeling is that the true value of the peso is 17 or lower. The next few weeks will tell.

    Dec 17th, 2015 - 11:37 pm - Link - Report abuse 0
  • Enrique Massot

    Of course, Mauricio couldn't wait. Freemarketers sing his praises while we'll hear other sounds when prices begin going up while wages stagnate.
    Interestingly, MP forgot to tell us about Mauricio's backtracking on the appointment by decree of two judges to the Supreme Court, after even friends told him the measure was unacceptable.
    While the new president deserves some credit for listening, the intent is worrisome because it departs from Macri's “be nice” tone thus far.

    Dec 18th, 2015 - 04:19 am - Link - Report abuse 0
  • Skip

    Oh Enrique is this what sour grapes sound like?

    Of course prices will be affected. But I have never heard you castigating CFK when she lied about inflation. Or when Argentina's inflation became one of the highest in the world.

    Where was your CONCERN then?

    Where was your CONCERN when CFK was appointing people during the last week of her presidency?

    You're a fake Enrique. Duplicitous and insincere.

    CFK create economic distortions in the economy by creating currency problems but the results of fixing this are Macri's sole fault?

    CFK couldn't fix those problems for years but it's Macri fault only now?

    I can see why you couldn't hack it in Argentina.

    Dec 18th, 2015 - 07:46 am - Link - Report abuse 0
  • Troy Tempest

    Enrique,

    Argentines are lucky Macri won the election.

    If Scioli had won, he would be faced with the same problems left by CFK - only, he would be stymied - he couldnt deviate from the Peronist model even as Rome burned, without facing public uproar and K criticism. He would have stood by helpless as things got worse - a scapegoat for CFK, whose followers like Enrique would say everything was 'fine' while Cristina was in power.

    Macri is acting confidently and decisively, away from the Peronist K model that wasn't working.

    Skip makes a good point - CFK was making lots of decrees and appointments, after she lost her mandate to govern.

    Dec 18th, 2015 - 09:02 am - Link - Report abuse 0
  • Mendoza Canadian

    His nominations for the court vacancies still have to be approved by congress. CFK on the other hand did things like this in the last days of her dictatorship:
    From the Telegraph... http://www.telegraph.co.uk/news/worldnews/southamerica/argentina/12037587/Cristina-Kirchner-creating-as-many-problems-as-possible-for-the-new-government.html

    She has approved the delegation of billions of dollars of spending to provincial governors. With ten days to go until the December 10 handover, she changed the budget for the next year, with increased spending on Congress, the judiciary, the security forces and her prized social plans including Football For All – a programme which shows free football matches, alongside political messages.
    The decree, 2585, signalled a surge in spending which she said was necessary for the cabinet to “guarantee the fulfilling of its objectives while in power”.
    She has appointed a slew of new ambassadors – to Cuba, Australia and the UAE – which, as her own appointees, can be replaced by Mr Macri, but present a headache.

    Dec 18th, 2015 - 12:09 pm - Link - Report abuse 0
  • tHroUGH_THE_lOOKING_GlASS

    ANGLOS will be ANGLOS, episode #43,690

    “Argentines are lucky Macri won the election.”

    So the fact that the Argentine voters selected him TWICE (in two elections) had nothing to do with it, just luck.

    Funny that when Argentines vote supposedly bad leaders (presumably CFK), then it's our fault, our choice, we get what we get. When it's presumably a good one, we are just lucky.

    Compare to the ANGLOS: if they vote Churchill, Thatcher, Reagan or Kennedy, then THEY chose. If they vote Bush, Blair, etc, then they were just unlucky.

    Soft supericioussness...

    Say it all together now:

    A_____ will b_ “ ” !

    Dec 18th, 2015 - 11:32 pm - Link - Report abuse 0
  • Skip

    So CFK was ruling by decree at the end?

    Guess she didn't have any friends to tell her this was unacceptable.

    Dec 18th, 2015 - 11:32 pm - Link - Report abuse 0
  • Captain Poppy

    Tobi de nostrils.......ad libbing is just not your thing. Seems if you can't pull ideas from thin air your ass will do. Have you ever located that intersection in Mendoza where you claim to live? Maybe you can refer me to a good restaurant when I'm there in a couple of weeks. I'd be surprised if you could.

    Dec 19th, 2015 - 12:35 am - Link - Report abuse 0
  • Marti Llazo

    @ 23....lucky, yes, and likewise Argentina was lucky that it was roundly and decisively defeated by the British in the 1982 war, since that humiliating defeat led directly to the end of the military government.

    Dec 19th, 2015 - 01:36 am - Link - Report abuse 0
  • Troy Tempest

    It's 04:30 GMT right now, and “Yankee”boy, Chronic, and “voice” have been quiet for two or three hours now.
    It's only 23:30 EST and 20:30 PST.

    Our 'American' brothers seem to go to bed early on Friday nights.

    “Just sayin' ”, as the Internet forum fanboys and FB addicts say...

    Dec 19th, 2015 - 04:34 am - Link - Report abuse 0
  • tHroUGH_THE_lOOKING_GlASS

    @26

    As usual your history is very Britto-Chili in being completely out of touch with reality.

    The reality IS, the Junta went to war because it was crumbling and knew it days were numbered. If they felt secure about their situation they would never had gone to war.

    So you are as usual directly wrong as to what the facts really are.

    Dec 19th, 2015 - 04:48 am - Link - Report abuse 0
  • Troy Tempest

    26 Marti,

    It's not usually worth responding to NOSTRILS - consider him useless 'click bait' , no more.

    Dec 19th, 2015 - 08:21 am - Link - Report abuse 0
  • Skip

    Well Argentineans shouldn't let juntas take over their country.

    Where's your belief in democracy? Don't you know that juntas are wrong?

    Dec 19th, 2015 - 08:21 am - Link - Report abuse 0
  • Troy Tempest

    If I recall properly, we were shocked to hear about the invasion on the news.

    Lacking any news footage or photos from the enemy - occupied territory itself, newscasts had to make do with footage of Argie civilians of all ages and professions, crowding the Plaza De Mayo in the tens, or 100's of thousands, jubilantly cheering the military invasion of a peaceful British civilian community.

    Nationalist spirits soared, 'disappearances' were forgotten, every soldier was a hero.... taxis blared their horns and people waved Argie flags and banners praising the Armed Forces and the Junta!!

    There didn't seem to be any moral objections from the average Argie citizen.

    Dec 19th, 2015 - 09:06 am - Link - Report abuse 0
  • CapiTrollism_is_back!!

    Topic deflection from the last two replies.

    The issue was what precipitated the fall of the Junta, not whether the population supported the war or not.

    Then I am accused of changing topic.

    ANGLOS WILL BE ANGLOS.

    Dec 19th, 2015 - 11:21 am - Link - Report abuse 0
  • Marti Llazo

    @ 31 - that is correct - there was overwhelming popular support for Argentina's invasion of the neighbour, roundly condemned by the UN, while the military government achieved its intended goal of diverting criticism of its management of the country. For a while..... But then, this was the Argentina that had been led to believe that its professionals and scientists were the best in the world.

    That the decisive defeat of Argentina by the British in 1982 was substantially though not solely responsible for bringing about the end of the military government is essentially axiomatic and is the prevailing belief even here in the Argentina of Denial. What is perhaps less widely recognised is that the defeat of Argentina in 1982 also prevented its planned invasion of Chile which had been only postponed after Vatican-based negotiations in 1978. En fin, the 1982 defeat and the end of the military government in Argentina in 1983 were ultimately positive events that not only ensured the independence of the Falkland Islands but increased stability in the Southern Cone region.

    Dec 19th, 2015 - 01:00 pm - Link - Report abuse 0
  • CapiTrollism_is_back!!

    The Southern Cone is more unstable today from British and Chilean (and Brazilian) armament buildup.

    All three are irresponsible nations, and thus are their wreckless policies.

    Dec 19th, 2015 - 01:54 pm - Link - Report abuse 0
  • Marti Llazo

    @ 34 With the exception of the credible threats from brasshole's bathtub navy, all is currently quiet and stable on the southern front. Neither Chile nor Brazil is poised to invade the neighbours as Argentina was doing (twice!) in the 1970s and 1980s. The defence of the Falklands is just that -- defensive. Or does the Troll Nouveau seriously believe that the UK is going to launch a preemptive strike to capture Venado Tuerto to seize the buggy-whip factories, thereby crippling the Argentine economy? So long as Argentina remains toothless and inept, things will be peaceful and stable.

    Dec 19th, 2015 - 06:24 pm - Link - Report abuse 0
  • Troy Tempest

    32 unknown new poster

    The point is - despite being financial governors, the junta did nothing that wasn't in line with the desires and sentiments of the general Argentine population - they read the consensus perfectly - they only left because they failed, dramatically.

    Dec 19th, 2015 - 09:24 pm - Link - Report abuse 0
  • yankeeboy

    Brazil is going to be the biggest problem for Argentina's recovery going forward. .Brazil's economy is in free fall and I don't see any way for them to stop in now.

    Dec 22nd, 2015 - 02:20 pm - Link - Report abuse 0

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