Why Argentina’s Hot Delivery Item Is Cold U.S. Cash

It’s not as if Argentina hasn’t been in economic trouble before -- its story, after all, is almost synonymous with sovereign default, including its ninth mere months ago. But rarely has it faced so many overlapping crises at once, with a pandemic-driven economic contraction coming on top of an already deep recession, inflation well into double digits, a currency crunch so bad that motorcycle couriers swarm the streets delivering black-market dollars and few prospects for help from the bond markets or international lenders. As its foreign-exchange reserves dwindle, the gap between the official and black-market exchange rate recently hit its widest in 31 years.

Capital controls have caused a surge in demand for U.S. dollars among Argentines trying to protect their pesos against devaluation. But savers are restricted to buying just $200 a month though official channels. Anything beyond that must be done through a series of financial trades or on the thriving black market, where greenbacks -- sometimes delivered door to door via motorbike -- fetch more than 150 pesos per dollar, or almost double the official exchange rate.