Fair Value Reached for Argentinian Peso, Turkish Lira, IIF Says
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A slowdown in the economies of Turkey and Argentina during the past year has corrected current-account imbalances to the extent that their currencies are now trading at fair value, according to the Institute of International Finance.
“Our model says that both currencies have converged to near fair value,” analysts including Robin Brooks, IIF chief economist and a former chief currency strategist at Goldman Sachs Group Inc., wrote in a research note dated Feb. 14. “But neither is cheap as current account adjustment is mostly cyclical, with a true ‘structural’ adjustment yet to meaningfully take hold.”