Bloomberg the Company & Products

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Argentine Peso to Fall to 5 Per Dollar in 2012, Goldman Says

July 30 (Bloomberg) -- The Argentine peso will drop to 5 per dollar by the end of this year and to at least 6 per dollar by the end of 2013, Goldman Sachs Group Inc. economist Alberto Ramos said in an e-mailed report.

Ramos ruled out a large, one-time devaluation and instead said he expected the government to allow a faster monthly depreciation of the currency, according to today’s report.

President Cristina Fernandez de Kirchner has tightened controls on the exchange rate and forbidden most purchases of foreign currencies in a bid to stem capital outflows, which reached a record $21.5 billion last year. Confidence in the government fell 7 percent in July for a second straight month, according to a poll released on July 27 by the Buenos Aires-based Torcuato Di Tella University.

“The forceful nature of the FX measures adopted by the government and the underperformance of the economy have eroded consumer and business confidence, triggered a run on private sector dollar deposits and added extra pressure on the peso to depreciate,” Ramos said in the report.

South America’s second-biggest economy, which expanded an annual average of 7.8 percent from 2003 to 2011, will probably expand less than 3 percent this year, Ramos said.

The peso has weakened 6 percent this year to 4.5738 per dollar, the biggest drop after the Brazilian real, which fell 8.3 percent in the same period.

To contact the reporter on this story: Eliana Raszewski in Buenos Aires at eraszewski@bloomberg.net.

To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net.

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.