MercoPress. South Atlantic News Agency

Argentina: Unstoppable “blue” dollar nears AR$ 900

De Pedro claimed that the run sought to damage Sergio Massa's presidential bid

The so-called “blue” (a euphemism for “black market”) dollar traded at AR$ 885 on Friday for a total increase of AR$539 so far this year and AR$ 42 overnight, it was reported in Buenos Aires. At some point Friday, it hit the psychological AR$ 900 landmark.

The AR$ 70 increase in the last five days resulted in the highest quotation after the Aug. 13 Mandatory, Simultaneous, and Open Primary (PASO) elections. The parallel dollar in the South American country advanced 80 pesos or 10 % in the first week of October alone and 28% since the PASO.

This increase takes place a little over two weeks ahead of the presidential elections and amid tough restrictions on operations within official banking circuits. Thus, the gap between the parallel bill and the official exchange rate stood at 152.8%.

In this scenario, Interior Minister Wado De Pedro claimed that the “cuevas” - as the illegal exchange parlors are known - sought to damage Economy Minister Sergio Massa's presidential bid through high volatility.

The so-called Qatar dollar for transactions abroad with credit cards, which includes a 30% PAIS tax plus a 45% advance on account of the Income and Personal Assets Taxes, in addition to another 5% surcharge for operations surpassing US$ 300, traded at AR$ 660.64. Below that threshold, it stood at AR$ 642.41.

In mid-August, the Federal Administration of Public Revenues (AFIP) ordered a reduction from 25% to 5% in the collection of Personal Assets to consumption abroad with debit and credit cards over US$ 300 per person per month. Thus, the so-called Qatar dollar is no longer the most expensive exchange rate in the market.

The sharp increase in the price was boosted by raids carried out Thursday by the Customs General Directorate (DGA), together with the Financial Information Unit (UIF) and the Money Laundering Division of the Argentine Federal Police (PFA) as part of an investigation into the alleged leakage of US$ 400 million from 176 companies through false imports with the Integral Import Monitoring System (SIMI).

The raids were carried out simultaneously in 18 banks, eight accounting firms, and 25 companies located in downtown Buenos Aires and in the cities of Rosario, Córdoba, and Bahía Blanca.

Between July 2020 and July 2022, these companies are believed to have used false documentation and SIMIs, with the sole purpose of leaking foreign currency abroad. “Basically what they did was to simulate import operations. They never imported anything to Argentina and sent abroad US$ 400 million,” DGA Head Guillermo Michel explained Friday.

Since the primary elections held on August 13, the currency in the informal segment has climbed 28 percent.