Tuesday, December 10, 2019
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ECONOMY | 05-08-2019 18:03

Pre-PASO turbulence sends peso to 46.69 per greenback

Pre-PASO turbulence and China's devaluation of its currency hit the local exchange markets today, with country risk nearing 900-point barrier.

Pre-PASO turbulence and China's devaluation of its currency hit the local exchange markets today, pushing the peso above the 46-mark against the dollar as the greenback soared 80 cents.

At the close of play, according to an average from the Central Bank, the peso closed at 44.42 against the dollar to buy and 46.69 to sell.

In turn, country risk (riesgo país) ran close to 900, closing at 896 points.

This was the highest level for the dollar since the end of April, as international turmoil and pre-PASO primary turbulence dominated the markets, ahead of Sunday's vote. Outside of Argentina, the devaluation of the yuan impacted heavily on emerging markets.

Earlier in the day, Argentine bonds has fallen, with the extra yield investors demand to hold government debt over US Treasuries widening 53 basis points to 8.82 percentage points, according to JPMorgan Chase & Co.’s EMBI Diversified index. Dollar bonds maturing in 2046 declined 2.7 cents to 76.4 cents on the dollar, with the yield rising to 10.21 percent. The peso fell 1.7 percent to 45.40 per US dollar.

Emerging market assets also retreated on Monday after Chinese authorities let the yuan weaken past seven per dollar for the first time in more than a decade. The moves come in the wake of US President Donald Trump’s latest escalation of the trade war and added to concerns of a market already unnerved by the Federal Reserve’s signal that it won’t pursue an extended easing cycle.

– TIMES/PERFIL/NA

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