Argentina's peso dives after currency controls lifted

[MowCowWhoHow III]

Source: BBC

Argentina's peso has lost about 30% of its value after the country lifted currency controls.

The drop comes after Argentine Finance Minister Alfonso Prat-Gay said he would eliminate the foreign exchange restrictions that have propped up the peso since 2011.

After his announcement, markets opened with one dollar buying 14 pesos.

Analysts had predicted a fall of up to 30% from the previous controlled rate of 9.8 pesos to the dollar.

Read more: http://www.bbc.co.uk/news/business-35123478

[elias49]

1. Not wasting any time

making things more palatable for the wealthy.

[Judi Lynn]

2. The Dirty War dictatorship supporter is getting right to work. n/t

[fasttense]

3. As predicted. Wow that's some inflation.

I would hate to have a middle class income and have to buy groceries in Argentina today.

[Judi Lynn]

4. Poor Argentines may feel pressed to have to steal groceries, fill up the prisons,

and Argentina, too, could start developing its private prison industry, just like the U.S.

[Dawson Leery]

5. On top of the 5% cut Macri placed in himself.

[FLPanhandle]

6. The Arentinian Peso was already worth 1/14 of a USD

All they did was eliminate the artificial exchange rate. Like Venezuela, if you had access to buy USD at the official rate, you could make a nice pile of money. Of course that is limited to those in power.

Artificial currency controls have never worked for long anywhere at anytime. Trying to legislate a currency control is one of the most stupid economic decisions a country can make.

Good for Argentina.

[Judi Lynn]

7. Argentinians Are Now Poorer Than Citizens Of Equatorial Guinea After Massive Devaluation

Argentinians Are Now Poorer Than Citizens Of Equatorial Guinea After Massive Devaluation

Submitted by Tyler Durden on 12/18/2015 19:00 -0500

On Wednesday evening, Argentina’s FinMin (and former head of global FX research at JP Morgan) Alfonso Prat-Gay abolished currency controls, fulfilling new President Mauricio Macri’s promise to unify the official and black market peso rates.

The move came on the heels of central bank governor Alejandro Vanoli's forced resignation. Macri has accused Vanoli of endangering the country's finances by racking up some $17 billion in dollar futures which the new government attempted to renegotiate ahead of the deval.

“For those interested in a case study of what happens after a dramatic devaluation, you now have front row seats for what is likely to be a 25-30% peso plunge,” we said two days ago. Yesterday, the peso did indeed take a nosedive as the parallel rates converged on 14 ARS/USD.



What does this mean for Argentinians, you ask?

Well, as FT reports, “Argentines woke up on Thursday richer than Poles, Chileans and Hungarians (but) by bedtime they were not only poorer than all three, but also more pecunious than Mexicans, Costa Ricans and the good people of Equatorial Guinea.”



More:
http://www.zerohedge.com/news/2015-12-18/argentinians-are-now-poorer-citizens-equatorial-guinea-after-massive-devaluation