USD/ARS Exchange hits new record high!
 

I think the AR$ remains overvalued by a fair % and that history shows that eventually, an artificially propped-up currency is going to have its crutches break one day.

Indeed.

I came back from Argentina Saturday. My last trip was in August 2017 when the rate was 1 USD to 15 peso. Now it is 1 USD to 20+pesos and things seemed expensive in USD. Restaurants seemed expensive. Still had fun on the trip, but not the tremendous value it used to be.

Peso passed 21 today.

Yes close to a 3% change from the day prior

https://cimg3.ibsrv.net/gimg/www.fly...dd22d2ba6c.png

Interesting Chart

My kitchen economics, based on empirical observation throughout my lifetime in this country, tell me that one litre of regular petrol here always costs one dollar, and the litre of petrol is now selling at approximately 26 pesos, i.e. there was some sort of “atraso cambiario” (literally, “the exchange rate is running late”).

I wouldn’t worry much about the exchange rate – it may go up a little bit more, and then come back to 21 pesos or so. The main problem is that with the recent price hikes in public utily bills and labour negotiations (“paritarias”) still ongoing, people have less and less money on their pockets, so public mood is volatile to say the least.

Exchange rate fell back this morning to around 22 as the government announced a hike in spot interest rates to 40%.

One day they will have to totally free the exchange rate - most independent econiomists agree that it should be around 25/26 per USD

Its a crazy situation . Most people feel that Macri and his buddies dont know what they are doing.

Inflation remains at above 25% and the government claims that the target for next year is 10% . But they have not taken one measure to bring down inflation

Before anything improves the Argentine mentality has to change.....that'll never happen. :D

What is the definition of "most" people....? And since when does a majority opinion equate to being right about something....??? :rolleyes:

In Economics, there is no such thing as magic. The Populist Kirchner Regime gave away approx 12% of GNP per year on subsidies that killed proper energy consumption habits and gave many people the illusion that they suddenly had money in their pockets for things they could not afford. After 12 years of this nonsense, it has come time to PAY THE BILLS. 1 + 1 is 2, its not 2.1 and its not 2.5, its 2... this is math, its quite simple.

Armchair comments are very easy and amusing, but they almost never make much sense. The Fed has started to raise interest rates and that is a very strong external component that is a very relevant part of the Peso's current movements. This situation is of course compounded by the fact that Argentina (sadly) doesnt have much of a Currency, and even lower classes here know that they are not to save in Pesos.... and this is also another factor that adds pressure to the overall situation.

Hiddy hits the spot.... mentality has to change but that takes generations, and is a slow and many times (painful) process. In the end, I blame the British for all of this, but that is part of a bigger theory of mine that involves deep knowledge of Argentine History so I will leave this at that for now...... :rolleyes:

(not travel and FFP related)

Respectfully, this is one of the most ill-advised posts I've ever read on FT. What you are proposing from a "travel point of view" is to freeze their economy again and make their currency 99.995% worthless outside of Argentina, which is what caused much of the current mess.