How much is the Arg. peso really worth?

antipodean

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Am still trying to understand who will actually use the dollar official and what the country actually gained from avoiding a simple devaluation.

In other news Argentine stocks have plummeted and the risk rating is increasing once more.
 

jblaze5779

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I used it to pay my rent. Came in handy. Any official documents require the use of the official so if you have access to dollars it's not bad.

But yes the official dollar is a farce.
 

Rich One

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Pagina12 is reporting the Blue dollar jumped to 145 this morning, but that tends to be the reaction to any policy change, in my observation; people run to the dollar. Then again, given Argentina's unfortunate history, it's hard to blame them for thinking "BOHICA!".
Now $150 .. tomorrow $180 ? the gap will go to 30% plus , it doesn't take a rocket scientist to predict that !! Even Pagina 12 agrees..!
 

EL_TIGRE_de_Tigre

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Now $150 .. tomorrow $180 ? the gap will go to 30% plus , it doesn't take a rocket scientist to predict that !! Even Pagina 12 agrees..!
I see very ugly things to come for the people of Argentina.

Voting in Alberto, no one could have envision COVID 19, because it was a very rare wild card, but things are being addressed form the Peronist point of view and that spells real trouble looking ahead.

I have been a broken record on the following:

Argentina needs to brace itself for a lost generation. The country is down for the count for a decade at least, but more probably 20 years. This is how bad the tip of the iceberg looks to me.
 

antipodean

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I used it to pay my rent. Came in handy. Any official documents require the use of the official so if you have access to dollars it's not bad.

But yes the official dollar is a farce.
Many contracts here are set in USD but paid in ARS, especially in business since it is not easy for most Argentines to access or transact in USD on a regular basis but the parties need some price certainty to offset fluctuations and inflation.
Problem arises as many people / companies still want to spend those “dollars”. As a result prices then start to follow the blue or a rate that can equate to the real amount needed to actually buy real USD. That’s when inflation starts doing strange things and the official effectively becomes meaningless. For example, if I want $1000 a month in rent / whatever then I set my price at the official rate of $1450 (or somewhere where I think the blue is going to go over the duration of the contract) The consumer ends up buying the blue at the official rate anyway and the inflation stats keep going up.

I remember a short period of time during the Krisitina years where a cup of coffee in BAs cost more than a cup of coffee in London, in official terms.
 

Redpossum

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There's a Farmacity a few blocks from my apartment where they have behind the register a sign saying that they accept dollars at 79 pesos per. I have to shake my head every time I see that. As if anyone would be foolish enough, when you can walk 3 blocks down Florida and get at least 120.

Then I remind myself that tourists newly arrived have no idea of all the mental gymnastics we go through calculating relative value and exchange rates.
 

antipodean

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Am trying to get confirmed advice from an expert in this field, but looks like companies will be prevented from sending money via the CCL (the rate that I suspect WU uses to send its Argentine branch $$$ so it can keep paying out locally)
Am getting mixed information but things could suddenly change tomorrow it seems.. the government wants companies and as many people as possible to buy pesos at the official rate so that it can keep the difference.

Invest in Argentina! For every $100 you bring in, we will let you take out $50!
 

dsp27

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Am trying to get confirmed advice from an expert in this field, but looks like companies will be prevented from sending money via the CCL (the rate that I suspect WU uses to send its Argentine branch $$$ so it can keep paying out locally)
Am getting mixed information but things could suddenly change tomorrow it seems.. the government wants companies and as many people as possible to buy pesos at the official rate so that it can keep the difference.

Invest in Argentina! For every $100 you bring in, we will let you take out $50!
I think the CCL rate WU follows is just a price reference. I do not believe WU actually passes the money thru the CCL market. Don't forget that there has been something like a 5 day "parking" of funds before cashing recently. And in many cases when I make small transfers of 300 dollars or less from the US I get the money into my ARG account the SAME day (zero fees).
 

dsp27

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Am not sure about this since WU Argentina deposits into bank accounts here and WU agents that give out the cash in Argentina. One has to wonder if the amount they collect here in Argentina (to be sent abroad) is sufficient to cover the amount it pays out, or WU abroad needs to pay WU Argentina to balance any deficit - in which case, they would more likely than not use the CCL like any company. Hence it gives them the ability to base their rates off of it even if just as a reference. If this door closes, then perhaps they would be like one of the other transfer companies with rates closer to the official.

Today the rate remains at 150 to the EUR, but the CCL rate is also like yesterday at 134 ... perhaps because no one is able/ willing to trade it at the moment as systems and internal policies are being reconfigured to reflect the new BCRA rules, and whole more official definition is being given to the “holding” rules.
I guess we need to wait and see. But I doubt WU uses the CCL market. They don't need to. I suspect the demand of people transferring OUT is quite large. In any case WU has other financial mechanism to deal with imbalances. But yes, let's wait a few days and see where the price settles.
 
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