Argentina’s President Cristina Fernández de Kirchner may have promised that she wouldn’t devalue the peso, and announced a series of measures to bring dollars back into the system.
But the black market isn’t listening. A day after breaking the 10 pesos barrier, the so-called “blue” dollar continued its upward march, hitting a new record high of 10.50 pesos on Wednesday.
While this may agitate the Fernández de Kirchner government, it doesn’t make everyone unhappy. Imported luxury car dealers, for example. Read more
It’s been a tough 24 hours for the people who run the Argentine economy.
A day after President Cristina Fernández de Kirchner promised that there would be no devaluation of the peso under her administration, everything seemed to go sideways.
First, the black market dollar – known as the “blue” dollar – broke through the Messi barrier. Read more
The words certainly sound familiar. But not in a good way.
In a nationally televised address on Monday evening, Argentine President Cristina Fernández de Kirchner vowed not to devalue the peso while she was in office, because to do so would hurt the poor and the middle class. Read more
Judging from Thursday’s successful Paraguayan bond sale, bond investors are clearly more desperate to find a good return somewhere – anywhere – then they are interested in constitutional niceties.
Paraguay agreed to sell $500m in bonds at 4.625 per cent, at the bottom of the guidelines of 4.625 per cent to 4.75 percent and far below earlier talk of 5 per cent, Reuters reported. Even more impressively, Paraguay came in under its neighbor Bolivia, which sold $500m in bonds in October at 4.875 per cent. Read more
Argentines continue sprinting away from their peso as if it were slathered with avian flu virus. After hitting a record high yesterday, the black market (or “blue”) dollar in Argentina hit another high on Thursday, of 7.54 pesos to the dollar, the local daily La Nación reported. Read more
Mutual desperation makes for some unlikely – and bitchy – friendships.
On Tuesday, according to Bloomberg, the US Second Court of Appeals accepted an amicus curiae filing from former Argentine central bank head Alfonso Prat-Gay in support of his country’s attempt to overturn a court ruling that would require Argentina to pay $1.3bn to holders of its defaulted bonds. Read more
It was nice while it lasted.
Like a harried engineer using his fingers to patch a leaky dyke, on Thursday the Argentine government announced yet another currency restriction aimed at stopping the bleed of foreign currency from its central bank.
This time the target was overseas credit card purchases, which up until now were not limited. Read more
Well, you can’t fault YPF for lack of ambition.
On Thursday, Miguel Galuccio (pictured), the CEO of Argentina’s recently nationalised YPF oil company, laid out a hard-charging five-year plan to increase production and return Argentina to its former glory as a net petroleum exporter. Read more
One company’s blunder is another company’s opportunity.
On Wednesday, just as Chilean retailer Falabella announced that its profits were down over the first half of 2012, Swedish retailer Hennes & Mauritz AB, better known as H&M, said it would expand into South America, opening a flagship store in Santiago, Chile, during the first half of 2013. Read more
Now that’s a nice raise! Or wait, maybe it’s just the rate of inflation.
On Tuesday evening, Argentine President Cristina Fernández de Kirchner announced that the country’s unions and business associations had agreed on a 25 per cent increase in the minimum wage, to be delivered in two parts. The monthly wage would rise from the current 2,300 pesos (about $494) to 2,670 pesos September 1 and then to 2,875 pesos in February. Read more
Billionaires evidently don’t win every time.
On Tuesday, Chile’s Supreme Court halted the planned $5bn Central Castilla thermoelectric power plant and port project. The court cited environmental concerns in its decision to put the kibosh on the power plant, a joint venture between Brazilian billionaire Eike Batista’s MPX Energia SA and Germany’s E.ON. Read more
See no evil, hear no evil, speak no evil.
That, apparently, is the mantra of the Argentine government when it comes to inflation. And woe to those who contradict it. Just ask the folks at Consumidores Libres, a non-profit that tracks prices and represents consumers in consumer protection lawsuits. Read more
Argentina is probably getting very tired of hearing the words “WTO complaint.”
On Monday, Mexico became the fourth country in three months to file a complaint about Argentine import restrictions with the world trade body. Read more
Argentina is perhaps the only country in which an announcement that the government would set prices and profit margins for private electricity sector companies would be greeted enthusiastically by the firms affected.
Then again, Argentina is one of the few countries where energy companies lose money. Read more
On Friday Chile’s securities regulator (SVS, for its initials in Spanish) put up a roadblock to Enersis’s novel plan for an $8bn cash call. For $4.86bn of the funds, Enersis – Chile’s largest power producer – planned to accept assets in lieu of cash from its majority owner, Spanish power company Endesa. And that’s where the problems began: Endesa’s valuation of the assets was, to some analysts and shareholders, far too rich. Among the shareholders, Chilean pension funds, known in Chile as AFPs, “strenuously rejected” the cash call because of the valuation. Read more
It wasn’t pretty, but it worked.
The Chilean construction and engineering company Echeverría Izquierdo on Friday raised $87.4m in an initial public offering on the Santiago stock exchange, making Chile the most active IPO market in Latin America so far this year. Read more
Polo (the game) is an Argentine staple. But Polo (the brand) is taking a break from Argentina.
Joining a growing list of luxury brands fleeing Argentina, Ralph Lauren has announced that it is closing its stores in the country, at least for now. Read more
It’s very exciting to get out from under a massive pile of debt. Just ask Argentina.
On the second floor of the economy ministry, three large screens count down the minutes to 10:15 a.m. Friday morning alongside the slogan “Without debt, we are more free”. The economy ministry’s website sports an even more exact count, down to the second. Each day, under the hashtag #independenciaeconomica (“economic independence” in English), economy minister Hernán Lorenzino chimes in with tweets about the upcoming good news. And to top it off, Argentine President Cristina Fernandez de Kirchner will commemorate the event at the Buenos Aires stock market on Thursday afternoon. Read more
A public relations adage holds that bad news is best released on Friday, so that it’s published in the little-read Saturday papers. And it’s a fair guess that Argentina’s government had an inkling that new rules governing the country’s petroleum industry and public shares in private companies, quietly made public on Friday, would not be warmly embraced. Read more
In an interview with Radio Continental on Friday, Argentine central bank president Mercedes Marcó del Pont confirmed news reports that the government was considering means to stop guarantees in the country’s futures markets from being written in dollars or other foreign currencies. Read more