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Thursday, March 23, 2023

Dollar rises in response to Argentina’s new economy minister

Buenos Aires ( Associated Press) – The dollar in the informal market in Argentina rose on Monday in reaction to the appointment of Silvina Batakis as head of the economy ministry, ushering the ruling coalition into a new chapter in the crisis over how to combat inflation and others. Shakes. problems in the country.

The parallel dollar was trading at 265 pesos per unit in the informal market for which citizens and companies go, compared to an average of 230 pesos last Friday due to restrictions on obtaining it through legal means.

Meanwhile, the official dollar was trading at 130.75 pesos per unit compared to 130.25 pesos on Friday. The value of the American currency—in which citizens save because of the fragility of the peso—has traditionally served as a thermometer of economic and political reality in the country.

President Alberto Fernández on Sunday night appointed Batakis as the new minister of economy after Martin Guzmán resigned a day earlier, whose economic policy has been questioned by Vice President and former President Cristina Fernández de Kirchner (2007-2015). was. and failed to control inflation.

The president, who backed Guzmán against criticism of the former president, had to agree Batakis’ appointment with his partner in power, with whom he had not spoken personally for months. The two Peronist leaders spoke on the phone to agree a way out of this new crisis in the ruling coalition, which threatens to exacerbate financial instability.

The officers will take oath of office in the government building in the afternoon.

Analysts expect a cramped day in the markets, even though it is a holiday in the United States as it is Independence Day, so there will be a pause in Argentine bonds and stocks listed abroad.

Former finance secretary Daniel Marx said Argentina is in a delicate situation and the appointment of the head of the economy “cannot focus on a name change, but rather we have to see what it can contribute.”

Batakis will have to define whether the economic course will continue to adhere to the economic targets agreed with the International Monetary Fund in an agreement to refinance the nearly $45,000 million debt he signed in March. That agreement, which implies a reduction in public spending, is rejected by the vice president, who questions the organization’s adjustment policies.

Batakis was Minister of Economy of the Province of Buenos Aires between 2011 and 2015—when Fernández de Kirchner ruled the country—and served as Secretary of the Provinces of the Ministry of the Interior, the region in charge of La Campora, which integrates the organization. The vice’s circle is intimate.

The new economy minister faces a number of challenges: accumulated inflation near 30% and which is expected to exceed 70% throughout the year, poverty which affects more than 37% of the population, and poverty that affects debt payments. Rare international reserves.

The informal dollar jumped last week due to a shortage of the US currency and restrictions on imports to ensure its supply, which is expected to have a direct impact on inflation. In return, the Argentine ties were broken.

World Nation News Desk
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