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The Argentine parallel market peso has strengthened against the U.S. dollar following the implementation of new economic measures by the government. The local stock market, however, experienced a decline in response to these measures.
Government’s Economic Measures
The government’s plan to halt the expansion of the monetary base in an effort to combat inflation was outlined by the economy minister, who also announced a $1.5 billion purchase from the central bank to meet bond interest obligations due in January.
As a result, the peso saw a 6.01% increase, reaching 1,415 pesos per dollar, with the gap between the black market “blue” exchange rate and the official rate narrowing to 53%.
Monitoring and Expectations
The effectiveness of these measures is being closely monitored, with local settlement and clearing agent Neix emphasizing the need for a significant reduction in the exchange rate gap and a subsequent decrease in inflation.
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