Experts: what will the devaluation of the peso in Argentina lead to?

The devaluation of the peso in Argentina has already become a common practice among right-wing presidents, and it is often used to bring the official and the «gray» (illegal) exchange rate of the peso into line with each other. 

The day before, the Argentine authorities announced that they would devalue the peso by more than 50% in order to cope with the economic crisis. Now you can get 366 pesos for one dollar. As a result of the devaluation, exporters will benefit, as their goods will become more competitive on world markets. However, importers of preferential goods will lose out, as they will have to pay more pesos for dollars.

The devaluation of the peso in Argentina usually occurs when there is a change of government with a right-wing political orientation. For example, in 2015, President Mauricio Macri lifted restrictions on the exchange of national currency and let the peso float freely. This led to a 30% drop in the exchange rate of the Argentine peso against the US dollar per day.

Later, as the economic situation worsened and the raid on banks began, Macri introduced «the dólar ahorro» (dollar for savings), the official exchange rate at which credit institutions exchanged dollars. The limit for such an exchange was set at $200 per month. At the same time, in fact, it was almost impossible to get a dollar at this rate, since the country prohibited its use in relation to entire groups of people – state employees, recipients of social assistance and owners of cryptocurrencies.

Economists note that in the context of the entire package of economic reforms in Argentina, devaluation may still play a role, but other factors need to be considered to assess its impact on the economy.