Argentine Peso Tumbles Most Since 2009 on Move to Boost ExportsCamila Russo
Argentina’s peso fell the most in four years as the government allows the currency to depreciate to make the country’s exports more competitive.
The peso fell 0.7 percent to 6.3769 per dollar today, the biggest slide since March 2009. It’s weakened 23 percent this year, the most among 24 emerging market currencies tracked by Bloomberg, almost matching inflation estimated at 26 percent.
President Cristina Fernandez de Kirchner’s government has sped up the rate of decline of the peso since July, when the currency started posting monthly losses of at least 2 percent, as a narrowing trade surplus contributes to the steepest drop in international reserves in a decade. Faster depreciation also reduces incentives for Argentines, who are banned from purchasing foreign currency for savings, to buy dollars in the black market as the spread between the two rates narrows.
“Importers are getting more authorizations from authorities to buy dollars for their products so that’s increasing demand,” said Jose Alfredo Nogueira, the director of Buenos Aires-based ABC Mercado de Cambios. “It’s obvious that the goal of the government in the past few months has been to let the dollar rise faster and some days it just lets it go.”
The central bank bought $70 million in the foreign exchange market today from exporters, according to a bank official who asked not to be identified because he’s not allowed to speak publicly.