January 22, 2018
Thursday, January 16, 2014

'Blue' dollar continued climb, hit 11.55 pesos

Purchase pressure on the so called “blue” dollar continues pushing greenbacks in the informal market, and closed 35 cents up at 11.50 pesos for buyers and 11.55 pesos for sellers. Yesterday, the blue hit a new record high amid high tourists’ demand.

Meanwhile, the US currency was traded one cent and half higher at 6.73 pesos (buying price) and 6.78 pesos (selling price) at Buenos Aires City banks.

On Wednesday, the black market dollar weakened to a record 11.21 pesos per US dollar, foreign exchange traders reported, with the greenback surging past the unprecedented mark amid high demand during the tourist season.

As the illicit, or so-called “blue,” dollar rose 16 cents, the official exchange rate went down just under one percent to an all-time low of 6.76 per dollar, continuing the sharp devaluation accelerated since Juan Carlos Fábrega took the helm of the Central Bank.

In fact, the official rate depreciated at a quicker pace of five cents yesterday, culminating a one-peso drop since September.

The anemic condition of the black market peso also reflects a particular context of low confidence in the currency, with foreign investors tempted by the lure of getting more bang for their buck with the “blue” rate.

“There are many pesos that lack a final destination, and they go toward the dollar,” a trader told private news agency DyN, specifying that in “December alone, the Central (Bank) printed 40 billion (pesos).”

“The population is turning its back on the local currency,” said Buenos Aires-based economic consultant Jorge Todesca. “All roads lead to the dollar.”

Currently at US$29.858 billion and falling, Central Bank reserves fell US$11 billion, or 30 percent in 2013.

“Certain players seeking to take advantage of prices with the objective of making short-term profits returned to the arena,” an analyst told á

Foreign exchange operators also say the parallel devaluation is quickening because tourists that have vacation planned for the next few weeks are buying dollars earlier, afraid that the devaluation will continue.

With demand and prices surging, many tourists with holidays scheduled in a few weeks were reported to have flocked to change their pesos for dollars to avoid higher rates before their departure.

Former Central Bank Governor Aldo Pignanelli considered that the value of the black market currency will keep rising, because it “will accompany inflation” levels. Piganelli said he expected the rate to end the year at 13 pesos.

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Tags:  Argentina  US dollar  blue dollar  

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