Three Signs Show That Argentina Is Heading to a Devaluation
- Peso liquidity and energy costs proving a dangerous cocktail
- Central bank may be pushed into a one-time devaluation: BTG
Argentine 500 peso banknotes are arranged for a photograph in Buenos Aires, Argentina, on Saturday, March 30, 2019.
Photographer: Sarah Pabst/BloombergThis article is for subscribers only.
Argentina’s parallel exchange rate is heading for a fall; a fall so big it may drag down the official peso with it.
The need to increase the monetary base to meet payments on peso debts and finance spending, plus a drop in agricultural exports and an increase in energy imports all spell trouble for the Argentine currency.