The Argentinian central bank seems ready to do everything in its power to get rid of the currency crisis it suffered last year, even if this means prolonging the economic recession and jeopardizing the re-election of President Mauricio Macready.
The central bank sold 190 billion Argentine Pesos ($ 4.6 billion) in short-term debts in March, effectively eliminating 13.5 percent of the nation's total cash base, circulation agency Bloomberg said. Interest rates and the suffering of the peso.
The move is a stricter response than is required under the $ 56 billion loan agreement with the International Monetary Fund (IMF).
The tactic managed to support the local currency, reducing losses at the beginning of last week and then dropping to a record level again, the biggest test for the IMF deal since signing in September.
With the withdrawal of many funds by the bank, interest rates again rose by 6 percentage points to around 60 percent, which threatened to deepen the recession of the economy, which shrunk by 2.6 percent last year, thereby reducing support for the Argentinian president has undermined the run-up to the October presidential election.
"Every day is a new test for the peso, which shows the shortcomings of the Argentinian central bank when it comes to managing the currency, despite the many attempts," said Alejandro Cuadrado, a currency strategist at Banco Bilbao Vizcaya Argentaria.
It is easy to see why the Argentine Peso is the first currency sold by private individuals when the fear of growth reoccurs. "The peso was the worst performing currency in emerging markets in the past three years amid rising inflation and chronic US dollar deficits.
Bloomberg said McCreery promised to change investors' perceptions, stabilize currencies and reduce inflation, but it has not yet succeeded: inflation remained high at 49 percent in January and the peso fell by 9.3 percent to become the worst-performing currency again. flow.
At the same time, some analysts think the worst is over for the economy. "Marcos Boscalia, a senior partner of Alberdi Partners, said that the foundations of Argentina are good." The country is about to harvest the large soybeans in April, will see a fall in inflation and a stronger peso if threats to dollarization are no longer seen.
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