Monday, February 26, 2024

ECONOMY | 17-10-2020 08:30

Blue dollar soars again to close week at 178 pesos

Dolár blue has risen by 11 pesos in past week alone, closing week at record high amid continued financial uncertainty.

Argentina’s infamous “blue” dollar picked up pace again on Friday, rising a further seven pesos to hit a new record of 178 pesos, 129 percent ahead of the official exchange rate.

Amid continued financial uncertainty the parallel, black market exchange rate had remained quiet until midweek before climbing four pesos on Thursday with hardly anybody selling greenbacks.

In the past week, the dolár blue has risen by 11 pesos.

All this did not prevent Economy Minister Martín Guzmán from telling the 56th IDEA (Instituto para el Desarrollo Empresarial de la Argentina) Colloquium yesterday that it was the official exchange rate which represented the economic reality of a middle-income country, not the alternatives, denying that the latter had any real impact on the economy. Guzmán also reassured IDEA businessmen that the capital controls would not be permanent but that it was necessary to stock up Central Bank reserves of US$41 billion, pointing out that these capital controls had been introduced by the previous administration.

Steep rise

A month ago the “blue” dollar was 131 pesos but the 35 percent surcharge slapped on legal dollar purchases along with restricting their availability only seems to have pushed up the parallel exchange rate as well. But at least the new restrictions have pushed down the demand for those legal “savings” dollars (capped at US$200) by 75 percent so far this month, according to the Central Bank, which also reported recovering US$30 million for reserves yesterday.

While expressing concern about foreign currency reserves, Guzmán sounded an upbeat note at IDEA on inflation, saying that he expected it to be 20 points down this year from the 53.8 percent of 2019. The minister also expressed optimism that an agreement with the International Monetary Fund (IMF) would help to regain stability. 

The US-trained economist also ratified the denials of any new devaluation by President Alberto Fernández when it was his turn to address IDEA on Wednesday, seeing no reason why the dollar should not close this year at 81.40 pesos and next year at 102.40 pesos, as specified in the 2021 budget.

At the same time Guzmán did not deny that he was administering “a situation of economic emergency, deepened by the context of pandemic” while insisting that “solid progress” was being made in ordering the economic fundamentals. 

In other exchange rates the CCL (contado con liquidación) based on bond transactions closed yesterday at 167.93 pesos after peaking at 172 while the MEP (mercado electrónico de pagos) based on shares closed yesterday at 155.79 pesos.


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