MercoPress, en Español

Montevideo, May 16th 2022 - 15:17 UTC

 

 

The Argentine Peso responds to central bank measures sponsored by the IMF

Wednesday, May 1st 2019 - 02:49 UTC
Full article 3 comments
The peso was up 1.12% at the open to 43.60 per U.S. dollar, before falling back to nearly unchanged from Monday’s close at 44.40 to the greenback The peso was up 1.12% at the open to 43.60 per U.S. dollar, before falling back to nearly unchanged from Monday’s close at 44.40 to the greenback

Argentina’s embattled peso currency gained briefly against the dollar on Tuesday after the central bank announced measures aimed at controlling volatility of the currency amid a grinding recession.

 The peso was up 1.12% at the open to 43.60 per U.S. dollar, before falling back to nearly unchanged from Monday’s close at 44.40 to the greenback.

On Monday, immediately after the central bank unveiled its new policies, the peso surged to close the day 3.56% stronger.

The measures gave the central bank more freedom to support the local currency by loosening a no-intervention peso trading band that had been in place since October, an effort to calm local markets.

The approach to volatility in the foreign currency market was agreed with the IMF which has extended a US$ 56.7 billion stabilization credit.

Categories: Economy, Politics, Argentina.

Top Comments

Disclaimer & comment rules
  • Zaphod Beeblebrox

    EM,

    “the Argentine government has stopped publishing the reserve amounts held by the Argentine Central Bank”

    I've not seen this reported anywhere else. Do you have evidence to support this claim?

    The Argentine government balance sheet is certainly available up to late 2018 and the trend looks very healthy. Also more recent data on the foreign reserves is available and, again, the trend looks good.

    https://tradingeconomics.com/argentina/foreign-exchange-reserves

    Maybe this is related to the positive balance of trade and reducing trend in capital flow out of the country since mid 2018? Some aspects of the Argentine economy are definitely moving in the right direction.

    May 02nd, 2019 - 05:08 pm +1
  • Enrique Massot

    ZB

    “Some aspects of the Argentine economy are definitely moving in the right direction.”

    Sure. You must be part of the few fortunate. As for the global situation, not even the trolls of Marquitos Peña are supporting your claim.

    In the last three years, 10 per cent of the population with the highest incomes saw their income grow by 203 per cent. These people have clear reasons to be optimistic.

    In comparison, during the same period the 10 per cent of the population with the lowest incomes experienced 147 per cent income growth. (Data provided by the Centro de Estudios de Ciudad (CEC), Facultad de Ciencias Sociales de la Universidad de Buenos Aires).

    Since Macri governs Argentina, 1.4 million of Argentines have joined the ranks of the poor, and 300,000 have become indigents.

    As for the Central Bank, they only stopped publishing details of their daily in and out cash movements -- saying they do not want to reveal their monetary strategy.

    In any event, as the Economist noted, the BCRA should disclose the net reserves it holds, as not everybody agrees to include the amounts provided by the swap with the Popular Bank of China or the IMF loaned money.

    https://www.eleconomista.com.ar/2019-03-las-reservas-netas-deberian-publicarse/

    May 03rd, 2019 - 04:34 pm -1
  • Enrique Massot

    So what? You can't effectively prop up a national currency when a country's economic activity is at a virtual standstill and the money injected through the IMF loans gets diverted out of Argentina.

    To top up the series of lipstick-on-the-pig maneuvers, the Argentine government has stopped publishing the reserve amounts held by the Argentine Central Bank.

    Welcome to Cambiemos transparency reign.

    May 01st, 2019 - 04:51 pm -2
Read all comments

Commenting for this story is now closed.
If you have a Facebook account, become a fan and comment on our Facebook Page!