Buenos Aires Times

economy 17-cent jump

Dollar hits record 19.61 pesos as Central Bank prepares interest rate cut

On Monday, Central Bank chief Federico Sturzenegger said there was "certain margin" to cut interest rates "gradually."

Tuesday 23 January, 2018
The dollar surpassed the 19-peso mark in late December on news the government was downgrading its inflation target for 2018 from 10 to 15 percent.
The dollar surpassed the 19-peso mark in late December on news the government was downgrading its inflation target for 2018 from 10 to 15 percent. Foto:Cedoc-Perfil

More Economy News

Currency exchange houses across Buenos Aires were selling a record-high dollar on Tuesday as expectations grew about an imminent cut to interest rates. 

The Central Bank is expected to announce on Tuesday afternoon a rate cut of between 0.75 to one percent.

At exchange houses, the dollar had soared 17 cents to a record 19.61 pesos by midday. The Central Bank, meanwhile, was buying dollars at a rate of 19.05 pesos and selling at 19.55.

On Monday, Central Bank chief Federico Sturzenegger said there was “certain margin” to cut interest rates “gradually.”

A BLOW FOR STURZENEGGER

In late December, the government backtracked on its inflation targets for 2018 from 10 to 15 percent, prompting the dollar to leap over the 19-peso mark.

The Central Bank had eyed off a target of 17 percent for 2017, but official annual inflation ended at 25 percent.

The December announcement was seen as a significant defeat for Sturzenegger who had resisted moves to lower the 2018 target.

Interest rates are expected to fall as the government focuses less on the mother of all battles, an abrupt and permanent decrease in inflation, and more on economic growth, which the government expects to reach 3.5 percent in 2018.

-TIMES/AGENCIES

Poll

Op-Ed

Top Stories

  1. 1Argentine tennis player Nicolás Kicker guilty of match fixingArgentine tennis player Nicolás Kicker guilty of match fixing
  2. 2Trump cancels summit, citing 'open hostility' by North Korea
  3. 3Grandmothers of Plaza de Mayo receive Nobel Peace prize nomination
  4. 4Petrobras shares plunge 10% after it bends and offers fuel price cut
  5. 5Ni Una Menos releases alarming statistics, reports 13 femicides in first 15 days of 2018
  6. 6IMF predicts brighter Brazil economy in 2018-2019
  7. 7Preaching democracy is out of fashion
  8. 8Development in City prompts debate over gentrification, cultural heritage
  9. 9‘What we are witnessing with North Korea is a slow-motion trainwreck’
  10. 10New Argentine ambassador to US submits credentials to Trump