Argentina Enforces Strict Dollar Exchange Control to Halt Drain on Reserves

The monetary authority has lost US$2.4 billion since January to meet the demand for foreign exchange to the economy. Argentines will be allowed to continue exchanging pesos for the maximum limit of US$200 per month, but will pay more for each dollar.

RIO DE JANEIRO, BRAZIL - In July, 3.9 million Argentines bought the official limit of US$200 (R$1,000) for personal savings. In August, the figure reached US$5 million. In September it seemed that a new record would be broken, but the Central Bank was quick to discourage demand and thus protect its reserves.

On Tuesday evening it announced a package of measures restricting the purchase of foreign exchange for accumulation, the use of cards abroad, and foreign exchange operations with bonuses. The decision prompted a drop in Argentine bonds in international financial markets and a sharp depreciation . . .

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