Argentina eases public's access to dollars
By Alexandre Peyrille, AFP
January 29, 2014, 12:08 am TWN
BUENOS AIRES--Argentina's peso held stable Monday after last week's sharp devaluation as the public began to take advantage of looser exchange controls, amid concerns over stability in several emerging economies.
Argentina's President Cristina Kirchner blamed speculators for the fall, which forced her government to ease unpopular controls on buying dollars, in place since 2011, after they proved ineffective in stifling capital flight.
From Monday, Argentineans could swap pesos for US$2,000 in a hard currency such as U.S. dollars each month at the official rate but large businesses and investors will remain barred from the hard currency purchases, said Jorge Capitanich, head of Kirchner's cabinet.
Permission will be restricted to “salaried workers, professionals, self-employed workers and small business owners,” who earn more than US$900 (7,200 pesos) a month, and the amount permitted will be tied to the person's earnings.
Sales are also limited to 20 percent of earnings, according to AFIP, the national tax agency, which must approve the transactions.
The exchange market remained relatively calm after the peso plunged 14 percent in panic-selling on Wednesday and Thursday.
Other currencies from major emerging economies have dipped sharply in recent days, as the end of extraordinary measures such as the U.S. Fed's stimulus program looms.
South Africa's rand hit a five year low on Monday, Brazil's real hit a five month low and Turkey's central bank called a crisis meeting after its heavy intervention failed to halt a run on the lira.
Argentina's official dollar rate held at 8.01 to the dollar Monday, level with where it stood Friday, amid reported support by the Central Bank of Argentina.
But in a sign of some remaining downward pressure on the currency, the peso fell to 12.2 to the dollar on the black market, compared to 11.7 pesos per dollar on Friday, according to the financial newspaper Ambito.com.
Meanwhile, after sinking last week, the Buenos Aires stock exchange rebounded for a 1.1 percent gain on Monday.