Argentine Peso's Wild Ride Is Getting Even WilderBy and
Argentina’s peso skidded more than 6 percent against the dollar Friday before clawing its way back. Sounds like a lot, right? Not exactly. That was only the biggest intraday tumble since last Thursday. In fact, the peso was the most volatile major currency in the world in the past month, beating the Turkish lira and Russian ruble for that dubious honor.
This volatility chart puts things in perspective:
The peso began its descent at the end of 2017, when the central bank raised its inflation target, paving the way for a 1.5 percentage point interest-rate increase in January. Then, as the peso’s losses accelerated in April, the central bank struggled to defend it by jacking up rates by a dramatic 12.75 percentage points to 40 percent -- the highest in the world.
Now the peso is heading for the worst week since December 2015, even after Argentina turned to the International Monetary Fund for help. The IMF says it wants to conclude talks on a possible credit line as soon as possible.