MercoPress. South Atlantic News Agency

Blue dollar knows no ceiling in Argentina

Since it was launched on May 22, the AR$ 2,000 bill lost around 66% of its value against the “blue” dollar

The “blue” (a euphemism for “black market”) US dollar closed at AR$ 843 Wednesday after touching AR$ 850 at some point during the day, it was reported in Buenos Aires. The new quotation at the end of the day was AR$ 36 higher than Tuesday's and meant an AR$ 497 increase so far in 2023 after reaching AR$ 346 at the end of 2022. Hence, the new gap with the official exchange rate stood at 141.4%.

Meanwhile, the credit card dollar with a 30% PAIS tax and a 45% income tax stood at AR$ 642.25, while for purchases over US$300, which have a 5% surcharge, it was quoted at AR$ 660.6.

The Central Bank (BCRA) sold US$ 80 million in the Single and Free Foreign Exchange Market (MULC). It was the second day in a row with a negative balance after a streak of 35 consecutive days of positive results. Thus, sales in the first three working days of October amounted to US$ 96 million to counterbalance September's US$ 530 million acquisitions in addition to Monday's purchases worth about US$ 21 million.

Less than six months after its launching, the AR$ 2,000 bill -the highest banknote in the country- has already lost a third of its value after suffering a 33% drop in purchasing power and 66% against the “blue” dollar, from US$ 4.11 to US$ 2.46 or less.

According to reports from Montevideo, the government of President Luis Lacalle Pou is monitoring the situation closely due to its impact on across-the-border shopping sprees that affect areas near international crossings.

The Uruguayan head of state reportedly admitted he felt helpless at these factors that “do not depend on us” while Economy Minister Azucena Arbeleche said that “Uruguayan purchases in Argentina are detrimental to Uruguay's growth and tax collection.” She also acknowledged that “the projections of consumption and tax collection in the budget include consumer spending in Argentina” which results in meager tax collections, in addition to fewer Argentines expected to visit the country during the coming summer season.