Why this huge discrepancy in ARS exchange rates?

[Gnomeo]

Hi everyone!

I would like to send some money from the Netherlands to a friend in Buenos Aires, so I checked a couple of apps. What I found puzzles me incredibly.

The official exchange rate for today is 1 EUR = 88,22 ARS. TransferWise and other services offer a similar rate.

WesternUnion, meanwhile, offers an exchange rate of 1 EUR = 163,33 ARS. Similarly, Xoom offers 1 EUR = 146,90 ARS.

Can anyone explain this phenomenon?

 

[Irelander]

Currency controls. I know, it's difficult to understand from where you are, but that's the way Argentina is. There's a chronic shortage of hard foreign currency in the country and this is how the government manages it. The WesternUnion rate looks excellent, only 1 peso below the black market exchange rate (known here as the 'Dolar blue' or 'Euro blue'). I'd use that if I were you.

 

[Gnomeo]

That sounds soooo strange indeed... But I've actually lived through something similar, even if I don't remember much. When I was a child back in Bulgaria, in the 90s, the Bulgarian currency was in a free fall. People were buying foreign currency from strangers on the street. I'm so sorry to learn Argentina is going through such a crisis now

 

[Irelander]

Well this is not something exceptional that's only happening at this particular point in time: it's more or less a permanent situation. This kind of currency control has been in place on and off for years.

 

[BAHibs]

Difference between what the Argentine government tells us the peso is worth and what it is actually worth.

 

[bdk1]

Well this is not something exceptional that's only happening at this particular point in time: it's more or less a permanent situation. This kind of currency control has been in place on and off for years.

This. My father used to go with his father to a cueva in microcentro in the early 70s to transfer money to Israel, where their money would be safe. Half a century later, nothing has changed.

To the OP, definitely use Western Union. I'm also NL based - laat me weten als je hulp nodig hebt!

 

[Pierre Smith]

At one point under Macri, the blue market had completely disappeared, as the peso was a normal currency. So, it's not inevitable that this disconnect exists.

Amazing that it's now at 164 to the dollar. Real estate must be booming.

 

[Moe]

164 to the Euro...dollar hasn't reached that yet

 

[Irelander]

164 to the Euro...dollar hasn't reached that yet

obviously: the €/$ rate is 1=1.16

 

[Irelander]

At one point under Macri, the blue market had completely disappeared, as the peso was a normal currency.

Worth remembering that it was Macri who re-introduced the exchange controls near the end of his term, and that they were more stringent that those of the preceding government. During his government, the peso devalued faster than ever - by 500% in 4 years - so it was hardly a 'normal' currency.