Buenos Aires Times

economy Unstoppable

Dollar rockets to 25.50 pesos in early trading as Lebac expiry nears

Half of all outstanding short-term Lebac notes expire on Tuesday, some $670 billion worth, which the Central Bank has been buying in an effort to avoid further damage to the peso. 

Monday 14 May, 2018
A teller in Buenos Aires counts US$ 50 bills.
A teller in Buenos Aires counts US$ 50 bills. Foto:Télam

More Argentina News

Argentina’s currency continued its downward spiral in early trading Monday, as the dollar shot to a record 25.50 pesos.

Tension is rife in Buenos Aires following the government’s decision last week to turn to the International Monetary Fund for a line of financing.

Media reports suggest that the Central Bank will sell US$5 billion in reserves to again attempt to put the brakes on the country's plummeting peso.

“Breaking!!!! The Central Bank will offer US$ 5 billion today. It will come at a price of 25 pesos”, wrote Clarin journalist Marcelo Bonelli on his Twitter account.

Half of all outstanding short-term Lebac notes expire on Tuesday, some $670 billion worth, which the Central Bank has been buying in an effort to avoid further damage to the peso. 

“A failure in rolling over the maturing Lebac stock would lead to a disorder bid on the dollar and renovated capital outflow,” JPMorgan analysts Diego Pereira and Lucila Barbeito wrote in a note last week.

Speculators have been selling en masse as Central Bank Governor Federico Sturzenegger gobbles up everything that comes his way. Tuesday’s sale will be closely watched.

DOLLAR

On Monday, Banco Nación had a buying rate of 24.50 pesos and a selling rate of 25.50, for a 7.4 percent increase on rates at close of business last Friday.

The peso has lost 30 percent of its value since the start of the year.

See also: Argentine economists weigh in on IMF deal

-TIMES

Poll

Op-Ed

Top Stories

  1. 1Economy set for slow recovery in 2019, experts sayEconomy set for slow recovery in 2019, experts say
  2. 2Norwegian Air Argentina workers granted permission to form union
  3. 3Supreme Court orders government to pay 15 billion pesos to San Luis province
  4. 4Emiliano Sala: human tragedy sparks unsavoury legal wrangle
  5. 5Heat warning issued, with temperatures set to hit 37 degrees
  6. 6Activists reiterate call for legal abortion in first pañuelazo of 2019
  7. 7Caught in the crossfire
  8. 8IMF: Argentina's recession to continue in 2019 with 1.7% slump
  9. 9Dujovne: Argentina's economy shrank by 2% in 2018
  10. 10Dia supermarket firm to cut costs after suffering 39% drop in sales