Spike In Blue Rate

[sinagua980]

What is the current rate for trading $1000USD or less?

Depends on who you sell to. You should normally be able to get 90-95% of the blue rate without many problems.

8.75 * .9 = 7.88 (U$S to AR$ 1)
8.75 * .95 = 8.31 (U$S to AR$ 1)

 

[camberiu]

Besides the obvious "tax" on foreign transactions, one possibility for the spike is that when the harvest is sold, there will not be as many dollars coming as in previous years. While the prices for most commodities are still high, last week we got the first robust reports on the coming harvest for soy and maize and they are not looking good. Volumes may be significantly lower than in previous years...

I would imagine that the current crisis in Europe and the flight to safety due to the Cyprus debacle might be having an impact too.

 

[el_expatriado]

Folks,

Can someone explain what's behind today's big jump in the blue peso/dollar rate, up 6+% to more than 8.7 ARS/USD? Some say it's due to the recent 20% 'tax' on foreign travel transactions, but I wonder if there's more to it.

Such a sharp (albeit unofficial) depreciation of the peso vs. dollar is a strong statement about confidence in the peso and Argentine economy, but why would this 'tax' cause people to suddenly run to buy dollars?. What am I missing?

- Jim

This is a direct effect of the 20% tourism tax. It is perfectly logical. When you make one dollar harder to get (the official), the free trading dollar that everyone has access to is going to go up in price. Supply and demand, baby! The problem is that the people running the country never had an econ 101 class.

 

[ajoknoblauch]

This is a direct effect of the 20% tourism tax. It is perfectly logical. When you make one dollar harder to get (the official), the free trading dollar that everyone has access to is going to go up in price. Supply and demand, baby! The problem is that the people running the country never had an econ 101 class.

In Argentina, the governing class knows that the principles of economics do not apply to them. They can command miracles or, if not, confiscate whatever they need.

 

[expatinowncountry]

I would imagine that the current crisis in Europe and the flight to safety due to the Cyprus debacle might be having an impact too.

I think it is possible but not likely because if that was the case you would have seen the same things in other Latin American countries the last few days. If something, the problem they have is that their currencies have been appreciating and not depreciating.
But you never know with this government, they are always happy to find an excuse for everything.

 

[notebook.fix]

I wonder how much the 'Campo' (agricultural industry) plays into this as well..it is well known that sectors of the industry are actively wanting to strangle the 'Pig' (K government) from US$ dollar oxygen. Obviously it can't be the prime reason for the sudden jump but how much does it contribute to it I wonder?.

 

[Rich One]

If the dollar blue goes down further more people want to buy .... ! Not only a few thousand expats but millions of Argentine's that have some extra pesos.

 

[scotttswan]

‘There’s no need to worry about the ‘blue’ dollar,’

http://www.buenosairesherald.com/article/126923/%E2%80%98there%E2%80%99s-no-need-to-worry-about-the-%E2%80%98blue%E2%80%99-dollar%E2%80%99-kirchnerite-deputy

Feletti remarked that “an exchange rate at AR$8.75 per dollar is not the real dollar”, and defended the government’s official rate, “Because someone who would like to import something, just have to submit all paperwork requested and will get a dollar exchange rate at AR$5,15.”

 

[lamarque]

Blue dollar is going down now quite abruptly, i supose the government is flooding the market. 8.27 Blue dollar to buy right now. There was almost no demand on the 8,76 pike anyway.

 

[ajoknoblauch]

Blue dollar is going down now quite abruptly, i supose the government is flooding the market. 8.27 Blue dollar to buy right now. There was almost no demand on the 8,76 pike anyway.

If you are correct, this is a short-term measure (as opposed to a solution). There are limits to how long they can get away with this.