Argentine Peso Rallies as Stock Market Suffers Post-Economic Reforms
The Argentine parallel market peso appreciated against the U.S. dollar while the local stock market saw significant losses following new economic measures by President Javier Milei's administration. These measures include halting the expansion of the monetary base and a significant bond interest payment from the central bank.
![Argentine Peso Rallies as Stock Market Suffers Post-Economic Reforms](https://devdiscourse.blob.core.windows.net/aiimagegallery/15_07_2024_14_34_57_0890776.png)
The Argentine parallel market peso appreciated against the U.S. dollar on Monday while the local stock market suffered, following the implementation of new economic measures by President Javier Milei's administration over the weekend.
On Saturday, Argentina's economy minister announced a plan to halt the expansion of the monetary base to combat inflation. The minister also stated on Sunday that a $1.5 billion purchase from the central bank would be made to pay bond interest due in January. The peso's value surged by 6.01% to 1,415 pesos per dollar, building on a 2% rise in early trading.
The gap between the black market 'blue' exchange rate and the official rate narrowed to 53%, down from around 60% last week. A local settlement and clearing agent Neix noted, 'The announced measures can be taken as positive if the gap falls significantly in the coming days and inflation plummets in the coming months.'
Meanwhile, the benchmark Merval index plummeted over 12%, and over-the-counter bonds fell by 3%.
(With inputs from agencies.)
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