Rewrite the provided article:
After setting a nominal record of $1,500 in mid-July, all versions of the U.S. dollar began to decline, eventually falling to the $1,100 area in early December. with a gap This gives way to a level less than 10%he”exchange summer vacation” raised questions about its duration and Risks of hovering above “ironing” exchange rates.
The last period of the Milei era, “pax Cambioria”, took place between the end of February and mid-May. In other words, it lasted for two and a half months. This time, the decline of US dollar financial varieties has not yet found a bottom, and continues to decline based on the currency flows generated by the US dollar. money laundering and Record agricultural liquidation October and November, on a stock background.
The industrial crisis of Javier Milei’s era accelerated, becoming more severe than that of Mauricio Macri’s management
Dictators don’t like this
The practice of professional and critical journalism is a fundamental pillar of democracy. That’s why it bothers those who think they have the truth.
Summer FX trading, dollar under pressure, peso firm
However, the economic team, headed by Luis Caputo, has yet to give a clue as to the exact date. exit ratein addition to ensuring it will take place sometime in 2025.
Regarding the temporary deadline for scrapping the current program, the former Economy Minister, Domingo Cavallo, Urges ruling party to lift restrictions before election. However, Milei and Caputo’s demands have yet to be met: Inflation in three months is below 2.5%, depreciation pattern dropped to 1% and “resolved inherited stock”.
Meanwhile, liberal governments enjoy a stable cycle in foreign exchange. Blue breaks above $1,100, trades at $1,090; MEP moved to $1,075 area; Cash Settlement (CCL) traded at $1,105. If the MEP is used as a reference, the difference to the official wholesale rate is 5.9%, which may be eliminated if this downward trend in the parallel sector continues.
In fact, a report from GMA Capital based on estimates from the Bank for International Settlements (BIS) shows that The Argentine peso appreciated 40% in real terms From December 2023 to October 2024, it will lead the global ranking.
The second place went Türkiye, lira appreciates 16.5%This is followed by Malaysia (8.5%) and South Africa (8.1%). on the contrary, Argentina’s main trading partner Brazil depreciated by more than 13% in the first 10 months of this year. Furthermore, the variable Real Exchange Rate Multilateral (TCRM), a measure of economic competitiveness, is at its lowest value since 2015 and is getting closer to the levels seen at the end of 2001.
“According to the manual, this situation is not harmless for the external sector. For example, in September, the current foreign exchange account balance turned negative for the fourth consecutive month. This time it was US$700 million, and the cumulative report emphasized that foreign exchange outflows in the third quarter 3.636 billion, at an average exchange rate of $1,080 to the dollar at today’s prices.
What economists think about the “exchange heat”
Talk to Economic Analyst PERFIL Christian Butler think The dollar is “artificially” late Because there is no large capital inflow that will cause the dollar to depreciate. At the same time, respondents insisted, “the dollar is subject to financial constraints.”
“Exchange rate imbalances are likely to persist over time. Dollars are needed, and those dollars come with money laundering. There is a buffer here that could provide financing for cheap dollars for a longer period of time. Not to mention whether they will be able to return to international credit markets and use this to fund themselves or renew maturing debt,” Butler explained of the durability of the “summer”.
Even so, consultants warn When an exchange rate lags, goods become more expensive to produce and cheaper to import.this dynamic will ultimately have an overall impact on the trade balance and thus on the level of economic activity.
“If imports are cheaper than Argentinian production, the level of economic activity will be affected by lower employment and lower output. In this way, the buds of the industry will be killed, recession againHe gave an example.
In assessing how long the peace of exchange could last, EcoGo’s deputy director, Sebastian Menescardiindicating that under current economic conditions, “Until stock is sold out“This hinders the free flow of capital in the economy.
“Only after that can we check whether this type of change is appropriate. Speaking about what will happen to the dollar level once the current link is lifted, Menescardi stressed that “either the structure of the economy and productivity will be corrected or if an additional leap will be necessary”.
The Economic Consultant Director of C&T said: Camilo Tiscogna,think”Processes that allow this type of exchange to be maintained are emerging But more demand factors are starting to emerge, such as tourism,” which consumes more dollars than it generates.
On the weakness of the peso’s appreciation, Tiscornia said “Puts a lot of competitive pressure on multiple companies, which can complicate things“The risks are associated with a very low exchange rate, company failures, job losses and at some point a sharp correction like the ones seen in Argentina’s history,” he added.
In his view, a public account surplus will help cushion the dollar’s eventual adjustment following the exchange rate announcement. “The official chance of a strong callback at this time is quite low.he mused.
Trump adviser asks Milley government to lift trap: ‘Do it now’
Finally, Chief Economist of the Liberal Progressive Organization, Eugenio Mariargues that “since 2018, Argentina has maintained a historically high real exchange rate” because citizens live in “an accelerating inflationary process. We Argentines got rid of the peso and bought foreign currencies, increasing their purchasing power” Power ”.
“At the same time, the process masks regulatory and production inefficiencies by paying low dollar wages. Now, It is logical that as inflation falls and the fiscal outlook improves, this process will reverse and the real exchange rate will appreciate.. Furthermore, reforms that remove regulations and distortions from the economy help increase productivity,” he determined.
He believes that whether it is the growth of output or the dead cow like him Large Investment Incentive System (RIGI) They will serve as a source of foreign exchange earnings, thus mitigating foreign exchange losses due to brisk imports.
“All of this sets up a scenario where the equilibrium exchange rate is significantly lower than what we have seen in recent years. This is the flip side of rising hard currency wages. This creates a challenge for us to stop hiding competitiveness issues , and start solving the problem.
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After setting a nominal record of $1,500 in mid-July, all versions of the U.S. dollar began to decline, eventually falling to the $1,100 area in early December. with a gap This gives way to a level less than 10%he”exchange summer vacation” raised questions about its duration and Risks of hovering above “ironing” exchange rates.
The last period of the Milei era, “pax Cambioria”, took place between the end of February and mid-May. In other words, it lasted for two and a half months. This time, the decline of US dollar financial varieties has not yet found a bottom, and continues to decline based on the currency flows generated by the US dollar. money laundering and Record agricultural liquidation October and November, on a stock background.
The industrial crisis of Javier Milei’s era accelerated, becoming more severe than that of Mauricio Macri’s management
Dictators don’t like this
The practice of professional and critical journalism is a fundamental pillar of democracy. That’s why it bothers those who think they have the truth.
Summer FX trading, dollar under pressure, peso firm
However, the economic team, headed by Luis Caputo, has yet to give a clue as to the exact date. exit ratein addition to ensuring it will take place sometime in 2025.
Regarding the temporary deadline for scrapping the current program, the former Economy Minister, Domingo Cavallo, Urges ruling party to lift restrictions before election. However, Milei and Caputo’s demands have yet to be met: Inflation in three months is below 2.5%, depreciation pattern dropped to 1% and “resolved inherited stock”.
Meanwhile, liberal governments enjoy a stable cycle in foreign exchange. Blue breaks above $1,100, trades at $1,090; MEP moved to $1,075 area; Cash Settlement (CCL) traded at $1,105. If the MEP is used as a reference, the difference to the official wholesale rate is 5.9%, which may be eliminated if this downward trend in the parallel sector continues.
In fact, a report from GMA Capital based on estimates from the Bank for International Settlements (BIS) shows that The Argentine peso appreciated 40% in real terms From December 2023 to October 2024, it will lead the global ranking.
The second place went Türkiye, lira appreciates 16.5%This is followed by Malaysia (8.5%) and South Africa (8.1%). on the contrary, Argentina’s main trading partner Brazil depreciated by more than 13% in the first 10 months of this year. Furthermore, the variable Real Exchange Rate Multilateral (TCRM), a measure of economic competitiveness, is at its lowest value since 2015 and is getting closer to the levels seen at the end of 2001.
“According to the manual, this situation is not harmless for the external sector. For example, in September, the current foreign exchange account balance turned negative for the fourth consecutive month. This time it was US$700 million, and the cumulative report emphasized that foreign exchange outflows in the third quarter 3.636 billion, at an average exchange rate of $1,080 to the dollar at today’s prices.
What economists think about the “exchange heat”
Talk to Economic Analyst PERFIL Christian Butler think The dollar is “artificially” late Because there is no large capital inflow that will cause the dollar to depreciate. At the same time, respondents insisted, “the dollar is subject to financial constraints.”
“Exchange rate imbalances are likely to persist over time. Dollars are needed, and those dollars come with money laundering. There is a buffer here that could provide financing for cheap dollars for a longer period of time. Not to mention whether they will be able to return to international credit markets and use this to fund themselves or renew maturing debt,” Butler explained of the durability of the “summer”.
Even so, consultants warn When an exchange rate lags, goods become more expensive to produce and cheaper to import.this dynamic will ultimately have an overall impact on the trade balance and thus on the level of economic activity.
“If imports are cheaper than Argentinian production, the level of economic activity will be affected by lower employment and lower output. In this way, the buds of the industry will be killed, recession againHe gave an example.
In assessing how long the peace of exchange could last, EcoGo’s deputy director, Sebastian Menescardiindicating that under current economic conditions, “Until stock is sold out“This hinders the free flow of capital in the economy.
“Only after that can we check whether this type of change is appropriate. Speaking about what will happen to the dollar level once the current link is lifted, Menescardi stressed that “either the structure of the economy and productivity will be corrected or if an additional leap will be necessary”.
The Economic Consultant Director of C&T said: Camilo Tiscogna,think”Processes that allow this type of exchange to be maintained are emerging But more demand factors are starting to emerge, such as tourism,” which consumes more dollars than it generates.
On the weakness of the peso’s appreciation, Tiscornia said “Puts a lot of competitive pressure on multiple companies, which can complicate things“The risks are associated with a very low exchange rate, company failures, job losses and at some point a sharp correction like the ones seen in Argentina’s history,” he added.
In his view, a public account surplus will help cushion the dollar’s eventual adjustment following the exchange rate announcement. “The official chance of a strong callback at this time is quite low.he mused.
Trump adviser asks Milley government to lift trap: ‘Do it now’
Finally, Chief Economist of the Liberal Progressive Organization, Eugenio Mariargues that “since 2018, Argentina has maintained a historically high real exchange rate” because citizens live in “an accelerating inflationary process. We Argentines got rid of the peso and bought foreign currencies, increasing their purchasing power” Power ”.
“At the same time, the process masks regulatory and production inefficiencies by paying low dollar wages. Now, It is logical that as inflation falls and the fiscal outlook improves, this process will reverse and the real exchange rate will appreciate.. Furthermore, reforms that remove regulations and distortions from the economy help increase productivity,” he determined.
He believes that whether it is the growth of output or the dead cow like him Large Investment Incentive System (RIGI) They will serve as a source of foreign exchange earnings, thus mitigating foreign exchange losses due to brisk imports.
“All of this sets up a scenario where the equilibrium exchange rate is significantly lower than what we have seen in recent years. This is the flip side of rising hard currency wages. This creates a challenge for us to stop hiding competitiveness issues , and start solving the problem.
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, while maintaining the same key facts, dates, and quotes. The new text should feel completely fresh, naturally flowing, and as if written from scratch by a professional human news editor.
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After setting a nominal record of $1,500 in mid-July, all versions of the U.S. dollar began to decline, eventually falling to the $1,100 area in early December. with a gap This gives way to a level less than 10%he”exchange summer vacation” raised questions about its duration and Risks of hovering above “ironing” exchange rates.
The last period of the Milei era, “pax Cambioria”, took place between the end of February and mid-May. In other words, it lasted for two and a half months. This time, the decline of US dollar financial varieties has not yet found a bottom, and continues to decline based on the currency flows generated by the US dollar. money laundering and Record agricultural liquidation October and November, on a stock background.
The industrial crisis of Javier Milei’s era accelerated, becoming more severe than that of Mauricio Macri’s management
Dictators don’t like this
The practice of professional and critical journalism is a fundamental pillar of democracy. That’s why it bothers those who think they have the truth.
Summer FX trading, dollar under pressure, peso firm
However, the economic team, headed by Luis Caputo, has yet to give a clue as to the exact date. exit ratein addition to ensuring it will take place sometime in 2025.
Regarding the temporary deadline for scrapping the current program, the former Economy Minister, Domingo Cavallo, Urges ruling party to lift restrictions before election. However, Milei and Caputo’s demands have yet to be met: Inflation in three months is below 2.5%, depreciation pattern dropped to 1% and “resolved inherited stock”.
Meanwhile, liberal governments enjoy a stable cycle in foreign exchange. Blue breaks above $1,100, trades at $1,090; MEP moved to $1,075 area; Cash Settlement (CCL) traded at $1,105. If the MEP is used as a reference, the difference to the official wholesale rate is 5.9%, which may be eliminated if this downward trend in the parallel sector continues.
In fact, a report from GMA Capital based on estimates from the Bank for International Settlements (BIS) shows that The Argentine peso appreciated 40% in real terms From December 2023 to October 2024, it will lead the global ranking.
The second place went Türkiye, lira appreciates 16.5%This is followed by Malaysia (8.5%) and South Africa (8.1%). on the contrary, Argentina’s main trading partner Brazil depreciated by more than 13% in the first 10 months of this year. Furthermore, the variable Real Exchange Rate Multilateral (TCRM), a measure of economic competitiveness, is at its lowest value since 2015 and is getting closer to the levels seen at the end of 2001.
“According to the manual, this situation is not harmless for the external sector. For example, in September, the current foreign exchange account balance turned negative for the fourth consecutive month. This time it was US$700 million, and the cumulative report emphasized that foreign exchange outflows in the third quarter 3.636 billion, at an average exchange rate of $1,080 to the dollar at today’s prices.
What economists think about the “exchange heat”
Talk to Economic Analyst PERFIL Christian Butler think The dollar is “artificially” late Because there is no large capital inflow that will cause the dollar to depreciate. At the same time, respondents insisted, “the dollar is subject to financial constraints.”
“Exchange rate imbalances are likely to persist over time. Dollars are needed, and those dollars come with money laundering. There is a buffer here that could provide financing for cheap dollars for a longer period of time. Not to mention whether they will be able to return to international credit markets and use this to fund themselves or renew maturing debt,” Butler explained of the durability of the “summer”.
Even so, consultants warn When an exchange rate lags, goods become more expensive to produce and cheaper to import.this dynamic will ultimately have an overall impact on the trade balance and thus on the level of economic activity.
“If imports are cheaper than Argentinian production, the level of economic activity will be affected by lower employment and lower output. In this way, the buds of the industry will be killed, recession againHe gave an example.
In assessing how long the peace of exchange could last, EcoGo’s deputy director, Sebastian Menescardiindicating that under current economic conditions, “Until stock is sold out“This hinders the free flow of capital in the economy.
“Only after that can we check whether this type of change is appropriate. Speaking about what will happen to the dollar level once the current link is lifted, Menescardi stressed that “either the structure of the economy and productivity will be corrected or if an additional leap will be necessary”.
The Economic Consultant Director of C&T said: Camilo Tiscogna,think”Processes that allow this type of exchange to be maintained are emerging But more demand factors are starting to emerge, such as tourism,” which consumes more dollars than it generates.
On the weakness of the peso’s appreciation, Tiscornia said “Puts a lot of competitive pressure on multiple companies, which can complicate things“The risks are associated with a very low exchange rate, company failures, job losses and at some point a sharp correction like the ones seen in Argentina’s history,” he added.
In his view, a public account surplus will help cushion the dollar’s eventual adjustment following the exchange rate announcement. “The official chance of a strong callback at this time is quite low.he mused.
Trump adviser asks Milley government to lift trap: ‘Do it now’
Finally, Chief Economist of the Liberal Progressive Organization, Eugenio Mariargues that “since 2018, Argentina has maintained a historically high real exchange rate” because citizens live in “an accelerating inflationary process. We Argentines got rid of the peso and bought foreign currencies, increasing their purchasing power” Power ”.
“At the same time, the process masks regulatory and production inefficiencies by paying low dollar wages. Now, It is logical that as inflation falls and the fiscal outlook improves, this process will reverse and the real exchange rate will appreciate.. Furthermore, reforms that remove regulations and distortions from the economy help increase productivity,” he determined.
He believes that whether it is the growth of output or the dead cow like him Large Investment Incentive System (RIGI) They will serve as a source of foreign exchange earnings, thus mitigating foreign exchange losses due to brisk imports.
“All of this sets up a scenario where the equilibrium exchange rate is significantly lower than what we have seen in recent years. This is the flip side of rising hard currency wages. This creates a challenge for us to stop hiding competitiveness issues , and start solving the problem.
most favored nation treatment
, incorporating them naturally into the rewritten text.
Preserve all original HTML tags from
After setting a nominal record of $1,500 in mid-July, all versions of the U.S. dollar began to decline, eventually falling to the $1,100 area in early December. with a gap This gives way to a level less than 10%he”exchange summer vacation” raised questions about its duration and Risks of hovering above “ironing” exchange rates.
The last period of the Milei era, “pax Cambioria”, took place between the end of February and mid-May. In other words, it lasted for two and a half months. This time, the decline of US dollar financial varieties has not yet found a bottom, and continues to decline based on the currency flows generated by the US dollar. money laundering and Record agricultural liquidation October and November, on a stock background.
The industrial crisis of Javier Milei’s era accelerated, becoming more severe than that of Mauricio Macri’s management
Dictators don’t like this
The practice of professional and critical journalism is a fundamental pillar of democracy. That’s why it bothers those who think they have the truth.
Summer FX trading, dollar under pressure, peso firm
However, the economic team, headed by Luis Caputo, has yet to give a clue as to the exact date. exit ratein addition to ensuring it will take place sometime in 2025.
Regarding the temporary deadline for scrapping the current program, the former Economy Minister, Domingo Cavallo, Urges ruling party to lift restrictions before election. However, Milei and Caputo’s demands have yet to be met: Inflation in three months is below 2.5%, depreciation pattern dropped to 1% and “resolved inherited stock”.
Meanwhile, liberal governments enjoy a stable cycle in foreign exchange. Blue breaks above $1,100, trades at $1,090; MEP moved to $1,075 area; Cash Settlement (CCL) traded at $1,105. If the MEP is used as a reference, the difference to the official wholesale rate is 5.9%, which may be eliminated if this downward trend in the parallel sector continues.
In fact, a report from GMA Capital based on estimates from the Bank for International Settlements (BIS) shows that The Argentine peso appreciated 40% in real terms From December 2023 to October 2024, it will lead the global ranking.
The second place went Türkiye, lira appreciates 16.5%This is followed by Malaysia (8.5%) and South Africa (8.1%). on the contrary, Argentina’s main trading partner Brazil depreciated by more than 13% in the first 10 months of this year. Furthermore, the variable Real Exchange Rate Multilateral (TCRM), a measure of economic competitiveness, is at its lowest value since 2015 and is getting closer to the levels seen at the end of 2001.
“According to the manual, this situation is not harmless for the external sector. For example, in September, the current foreign exchange account balance turned negative for the fourth consecutive month. This time it was US$700 million, and the cumulative report emphasized that foreign exchange outflows in the third quarter 3.636 billion, at an average exchange rate of $1,080 to the dollar at today’s prices.
What economists think about the “exchange heat”
Talk to Economic Analyst PERFIL Christian Butler think The dollar is “artificially” late Because there is no large capital inflow that will cause the dollar to depreciate. At the same time, respondents insisted, “the dollar is subject to financial constraints.”
“Exchange rate imbalances are likely to persist over time. Dollars are needed, and those dollars come with money laundering. There is a buffer here that could provide financing for cheap dollars for a longer period of time. Not to mention whether they will be able to return to international credit markets and use this to fund themselves or renew maturing debt,” Butler explained of the durability of the “summer”.
Even so, consultants warn When an exchange rate lags, goods become more expensive to produce and cheaper to import.this dynamic will ultimately have an overall impact on the trade balance and thus on the level of economic activity.
“If imports are cheaper than Argentinian production, the level of economic activity will be affected by lower employment and lower output. In this way, the buds of the industry will be killed, recession againHe gave an example.
In assessing how long the peace of exchange could last, EcoGo’s deputy director, Sebastian Menescardiindicating that under current economic conditions, “Until stock is sold out“This hinders the free flow of capital in the economy.
“Only after that can we check whether this type of change is appropriate. Speaking about what will happen to the dollar level once the current link is lifted, Menescardi stressed that “either the structure of the economy and productivity will be corrected or if an additional leap will be necessary”.
The Economic Consultant Director of C&T said: Camilo Tiscogna,think”Processes that allow this type of exchange to be maintained are emerging But more demand factors are starting to emerge, such as tourism,” which consumes more dollars than it generates.
On the weakness of the peso’s appreciation, Tiscornia said “Puts a lot of competitive pressure on multiple companies, which can complicate things“The risks are associated with a very low exchange rate, company failures, job losses and at some point a sharp correction like the ones seen in Argentina’s history,” he added.
In his view, a public account surplus will help cushion the dollar’s eventual adjustment following the exchange rate announcement. “The official chance of a strong callback at this time is quite low.he mused.
Trump adviser asks Milley government to lift trap: ‘Do it now’
Finally, Chief Economist of the Liberal Progressive Organization, Eugenio Mariargues that “since 2018, Argentina has maintained a historically high real exchange rate” because citizens live in “an accelerating inflationary process. We Argentines got rid of the peso and bought foreign currencies, increasing their purchasing power” Power ”.
“At the same time, the process masks regulatory and production inefficiencies by paying low dollar wages. Now, It is logical that as inflation falls and the fiscal outlook improves, this process will reverse and the real exchange rate will appreciate.. Furthermore, reforms that remove regulations and distortions from the economy help increase productivity,” he determined.
He believes that whether it is the growth of output or the dead cow like him Large Investment Incentive System (RIGI) They will serve as a source of foreign exchange earnings, thus mitigating foreign exchange losses due to brisk imports.
“All of this sets up a scenario where the equilibrium exchange rate is significantly lower than what we have seen in recent years. This is the flip side of rising hard currency wages. This creates a challenge for us to stop hiding competitiveness issues , and start solving the problem.
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, including those for images, photos, videos, embeds (e.g., Instagram, X/Twitter), and other multimedia elements, and ensure they are correctly positioned in the rewritten article.
Write with a human-like tone and style, avoiding repetitive phrasing, robotic patterns, or overly formal language. Use creative yet professional language, focusing on engaging and authentic storytelling.
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After setting a nominal record of $1,500 in mid-July, all versions of the U.S. dollar began to decline, eventually falling to the $1,100 area in early December. with a gap This gives way to a level less than 10%he”exchange summer vacation” raised questions about its duration and Risks of hovering above “ironing” exchange rates.
The last period of the Milei era, “pax Cambioria”, took place between the end of February and mid-May. In other words, it lasted for two and a half months. This time, the decline of US dollar financial varieties has not yet found a bottom, and continues to decline based on the currency flows generated by the US dollar. money laundering and Record agricultural liquidation October and November, on a stock background.
The industrial crisis of Javier Milei’s era accelerated, becoming more severe than that of Mauricio Macri’s management
Dictators don’t like this
The practice of professional and critical journalism is a fundamental pillar of democracy. That’s why it bothers those who think they have the truth.
Summer FX trading, dollar under pressure, peso firm
However, the economic team, headed by Luis Caputo, has yet to give a clue as to the exact date. exit ratein addition to ensuring it will take place sometime in 2025.
Regarding the temporary deadline for scrapping the current program, the former Economy Minister, Domingo Cavallo, Urges ruling party to lift restrictions before election. However, Milei and Caputo’s demands have yet to be met: Inflation in three months is below 2.5%, depreciation pattern dropped to 1% and “resolved inherited stock”.
Meanwhile, liberal governments enjoy a stable cycle in foreign exchange. Blue breaks above $1,100, trades at $1,090; MEP moved to $1,075 area; Cash Settlement (CCL) traded at $1,105. If the MEP is used as a reference, the difference to the official wholesale rate is 5.9%, which may be eliminated if this downward trend in the parallel sector continues.
In fact, a report from GMA Capital based on estimates from the Bank for International Settlements (BIS) shows that The Argentine peso appreciated 40% in real terms From December 2023 to October 2024, it will lead the global ranking.
The second place went Türkiye, lira appreciates 16.5%This is followed by Malaysia (8.5%) and South Africa (8.1%). on the contrary, Argentina’s main trading partner Brazil depreciated by more than 13% in the first 10 months of this year. Furthermore, the variable Real Exchange Rate Multilateral (TCRM), a measure of economic competitiveness, is at its lowest value since 2015 and is getting closer to the levels seen at the end of 2001.
“According to the manual, this situation is not harmless for the external sector. For example, in September, the current foreign exchange account balance turned negative for the fourth consecutive month. This time it was US$700 million, and the cumulative report emphasized that foreign exchange outflows in the third quarter 3.636 billion, at an average exchange rate of $1,080 to the dollar at today’s prices.
What economists think about the “exchange heat”
Talk to Economic Analyst PERFIL Christian Butler think The dollar is “artificially” late Because there is no large capital inflow that will cause the dollar to depreciate. At the same time, respondents insisted, “the dollar is subject to financial constraints.”
“Exchange rate imbalances are likely to persist over time. Dollars are needed, and those dollars come with money laundering. There is a buffer here that could provide financing for cheap dollars for a longer period of time. Not to mention whether they will be able to return to international credit markets and use this to fund themselves or renew maturing debt,” Butler explained of the durability of the “summer”.
Even so, consultants warn When an exchange rate lags, goods become more expensive to produce and cheaper to import.this dynamic will ultimately have an overall impact on the trade balance and thus on the level of economic activity.
“If imports are cheaper than Argentinian production, the level of economic activity will be affected by lower employment and lower output. In this way, the buds of the industry will be killed, recession againHe gave an example.
In assessing how long the peace of exchange could last, EcoGo’s deputy director, Sebastian Menescardiindicating that under current economic conditions, “Until stock is sold out“This hinders the free flow of capital in the economy.
“Only after that can we check whether this type of change is appropriate. Speaking about what will happen to the dollar level once the current link is lifted, Menescardi stressed that “either the structure of the economy and productivity will be corrected or if an additional leap will be necessary”.
The Economic Consultant Director of C&T said: Camilo Tiscogna,think”Processes that allow this type of exchange to be maintained are emerging But more demand factors are starting to emerge, such as tourism,” which consumes more dollars than it generates.
On the weakness of the peso’s appreciation, Tiscornia said “Puts a lot of competitive pressure on multiple companies, which can complicate things“The risks are associated with a very low exchange rate, company failures, job losses and at some point a sharp correction like the ones seen in Argentina’s history,” he added.
In his view, a public account surplus will help cushion the dollar’s eventual adjustment following the exchange rate announcement. “The official chance of a strong callback at this time is quite low.he mused.
Trump adviser asks Milley government to lift trap: ‘Do it now’
Finally, Chief Economist of the Liberal Progressive Organization, Eugenio Mariargues that “since 2018, Argentina has maintained a historically high real exchange rate” because citizens live in “an accelerating inflationary process. We Argentines got rid of the peso and bought foreign currencies, increasing their purchasing power” Power ”.
“At the same time, the process masks regulatory and production inefficiencies by paying low dollar wages. Now, It is logical that as inflation falls and the fiscal outlook improves, this process will reverse and the real exchange rate will appreciate.. Furthermore, reforms that remove regulations and distortions from the economy help increase productivity,” he determined.
He believes that whether it is the growth of output or the dead cow like him Large Investment Incentive System (RIGI) They will serve as a source of foreign exchange earnings, thus mitigating foreign exchange losses due to brisk imports.
“All of this sets up a scenario where the equilibrium exchange rate is significantly lower than what we have seen in recent years. This is the flip side of rising hard currency wages. This creates a challenge for us to stop hiding competitiveness issues , and start solving the problem.
most favored nation treatment
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What are the potential risks associated with a prolonged period of “ironizing” exchange rates in Argentina?
Argentine Peso Appreciates Amidst “Summer Exchange” Period
The Argentine peso has experienced a significant appreciation against the US dollar, leading to what some are calling a “summer exchange.” After peaking at $1,500 in July, the dollar has fallen to around $1,100 in early December, raising questions about the duration of this trend and the risks associated with a prolonged period of “ironing” exchange rates.
Causes and Durability of the Peso’s Strengthen
Several factors have contributed to this depreciation of the US dollar and strengthening of the peso:
* **Agricultural Liquidation:** Record agricultural exports have brought a surge of US dollars into Argentina.
* **Money Laundering:** inflows of money intended for illicit purposes are further contributing to the dollar supply.
* **Capital Controls:** The government’s restrictions on access to US dollars have limited demand and created an artificial scarcity, leading to a gap between the official and parallel exchange rates.
Economists are divided on how long this “summer exchange” can last. Some believe it will persist until existing stockpiles of dollars are depleted, while others suggest it may be a temporary phenomenon driven by specific, short-term factors.
Economic Concerns and Risks
While a stronger peso may seem beneficial in the short term, economists warn of potential risks:
* **Overvalued Peso:** An overvalued peso can make Argentine goods less competitive in international markets, harming export-oriented industries.
* **Reduced Imports:** A strong peso can make imports cheaper, potentially hurting domestic production and leading to job losses.
* **Delayed Adjustment:** Postponing a necessary devaluation can result in a sharper correction down the line, causing economic disruptions.
Calls for a Market-Driven Exchange Rate
Some economists urge the government to lift capital controls and allow the exchange rate to be determined by market forces, advocating for a more sustainable and predictable economic environment.
The long-term implications of the current “summer exchange” remain uncertain, and Argentina’s economic future will depend on policymakers’ decisions and the country’s ability to address underlying structural issues.
