March 11, 2014
Close at US$29.857BFriday, January 17, 2014
Reserves plunge US$100M
Argentina’s foreign reserves plunged yet again yesterday to a new seven-year low, this time by exactly US$100 million to US$29.758 billion after breaking the psychologically important barrier of US$30 billion a day earlier.
Since Economy Minister Axel Kicillof took office on November 20, reserves have gone down an average US$58 million per working day, amounting to a total of US$2.028 billion.
The loss is complemented by the towering US$12.7 billion depletion seen in 2013.
During his daily early morning news conference, Cabinet Chief Jorge Capitanich had dismissed criticism over the continuous depletion of the Central Bank’s foreign currency by arguing that the drop symbolizes Argentina’s progress in repaying its debt.
Reserves currently stand at the lowest level since November 2006.
Capitanich added that the dwindling reserves were also due to “greater expenses in goods for productive development.”
Reserves are used to buy fuel overseas for an energy sector operating with a large deficit, as well as meeting foreign debt payments and finance economic stimulus programmes.
Critics say the reserves have also been depleted by government currency controls meant to stem capital flight.
Herald with AP