Prices, Pesos, Dollars

[garryl]

You're flat out mistaken in your take on the economy.BCRA has been cutting interest rates for months. The peso is 'loose' at it's market value except for when the BCRA depresses (NOT props up) its value on the occasions it gets too strong. All of this data is available from the bcra.gov.ar if you want to inform yourself.

No offense. Hard to inform completely from anything with a gov in it. Every central bank manipulates its currency, including FED. You are saying at 15.8, dollar to peso ratio is a good fair free market ratio ?

 

[lamarque]

No offense. Hard to inform completely from anything with a gov in it. Every central bank manipulates its currency, including FED. You are saying at 15.8, dollar to peso ratio is a good fair free market ratio ?

At the current interest rate and devaluation expectations [background=rgb(243, 168, 163)]I[/background] will say 15.8 is expensive, the government know that, that why they keep reducing the interest rate so the peso can slowly devaluate and less dollars enter into the country financial market. If you will tell me that the interest rate will be 10% then i will agree 15.8 will be cheap and surely the peso will lose value, but at the current interest rate the market is telling that the dollar is expensive and they prefer to invest in local financial instruments. Don't misread me, I'm not telling that this will remain like this forever, i'm just telling you that at the current interest rate and expectations 15.8 is the correct market value in this ceteris paribus, actually probably lower if the central bank wouldn't be lowering the interest rate every month and a half and sucking the dollars from the market like a vacuum cleaner. After all the greed of investors don't have limit once they have a situation where they see a certain stability and consensus and a relative high-interest rate.

 

[bobsnowpuppy]

Anyone who thinks that inflation is at 42% this year has another think coming. I'm estimating it is somewhere between 60 to 75% this year. since mid 2014 I have been tracking prices on everything I come across including items I purchased or not, rent, utilities, etc. There is no way inflation is below 60% at this point and quite likely much higher and still going strong.

 

[UK Man]

Strangely enough my perception of late has been that inflation is starting to if not go down but stabilise. The Kirchner years taught me never to take any inflation figures seriously so I judge it on the price of a packet of fags and a bottle of Quilmes. The price of a pack of Philip Morris hasn't risen for three weeks and I got a great deal on beer this week at the supermarket.
It could all go the other way next week though.

 

[RodalfoWalsh]

No offense. Hard to inform completely from anything with a gov in it. Every central bank manipulates its currency, including FED. You are saying at 15.8, dollar to peso ratio is a good fair free market ratio ?

Can you go buy a dollar for 15.8? Yes.

Then it's the free market rate. The central bank has only minimally been intervening in the forex market and when they've been doing so it's been to do the opposite of what you've suggested.

The inflation target for 2017 is 17% and if they stay the course I don't doubt they'll meet it.