Argentina’s Black Market Peso Strengthens as Milei Measures Spur Markets
Argentina’s Peso Strengthens on Informal Market
The peso on Argentina’s parallel informal market saw a significant 1.5% strengthening against the U.S. dollar, breaking below the 1,000 per dollar mark and reaching its strongest level since the end of December.
Milei’s Pro-Market Agenda Drives Surge
President Javier Milei’s announcement of his unwavering support for his libertarian pro-market agenda sparked the surge. He called on lawmakers and governors to back his austerity drive to address the deep fiscal deficit, leading to positive market reactions.
Capital Controls and Exchange Rate Gap
Argentina, struggling with inflation over 250%, has had strict capital controls in place since 2019. These controls have widened the gap between the official exchange rate and popular parallel markets, creating economic challenges for the country.
Narrowing Gap and Improved Exchange Rates
The gap between the official exchange rate of 845 per dollar and the black market rate, which previously reached a staggering 200% difference, has significantly narrowed to under 18% in recent times. This improvement indicates positive developments in the country’s economic landscape.
