This article is from the source 'bbc' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at http://www.bbc.co.uk/news/business-25913170
The article has changed 4 times. There is an RSS feed of changes available.
| Version 2 | Version 3 |
|---|---|
| Argentina imposes $2,000 limit on purchase of US dollars | Argentina imposes $2,000 limit on purchase of US dollars |
| (1 day later) | |
| Argentina said citizens can buy up to $2,000 (£1,210) per month if their monthly salary is over 7,200 pesos ($900), after a two-year ban on buying dollars. | Argentina said citizens can buy up to $2,000 (£1,210) per month if their monthly salary is over 7,200 pesos ($900), after a two-year ban on buying dollars. |
| But large businesses and investors will not be able to make the purchases. | But large businesses and investors will not be able to make the purchases. |
| Last week, Argentina said it would ease restrictions after the peso fell 11%, its sharpest daily fall in 12 years. | Last week, Argentina said it would ease restrictions after the peso fell 11%, its sharpest daily fall in 12 years. |
| US dollars could previously only be bought by citizens on the black market, which fuels the country's inflation. | US dollars could previously only be bought by citizens on the black market, which fuels the country's inflation. |
| Cabinet chief Jorge Capitanich said only "working professionals, workers and small business owners" would be able to buy the dollars. | Cabinet chief Jorge Capitanich said only "working professionals, workers and small business owners" would be able to buy the dollars. |
| However, Argentines earning over the 7,200 pesos minimum are still limited to changing only 20% of their salary into dollars, up to the maximum of $ 2,000 a month. | However, Argentines earning over the 7,200 pesos minimum are still limited to changing only 20% of their salary into dollars, up to the maximum of $ 2,000 a month. |
| Argentines are reportedly reticent about buying US dollars until details emerge about reclaiming a 20% tax rate on the money - which applies if the dollars are stored in the house. | Argentines are reportedly reticent about buying US dollars until details emerge about reclaiming a 20% tax rate on the money - which applies if the dollars are stored in the house. |
| The tax does not apply if citizens store the dollars in a bank account. | The tax does not apply if citizens store the dollars in a bank account. |
| Brian Coulton, global emerging markets strategist at Legal and General Investment management, said the government also intervened to devalue the peso, to eight pesos to the dollar, rather than seven. | Brian Coulton, global emerging markets strategist at Legal and General Investment management, said the government also intervened to devalue the peso, to eight pesos to the dollar, rather than seven. |
| He said Argentina had also raised interest rates to 6%. | He said Argentina had also raised interest rates to 6%. |
| 'Not freedom' | 'Not freedom' |
| Rates of inflation in Argentina are some of the highest in the world, as the peso trades at 40% less than its price on the black market. | |
| The black market is seen as a measure of what people in the country actually think the peso is worth - and a truer indicator of inflation - than the official exchange rate. | The black market is seen as a measure of what people in the country actually think the peso is worth - and a truer indicator of inflation - than the official exchange rate. |
| The Argentinean government is hoping the controls will bring the official and black market rates for the peso in line. | The Argentinean government is hoping the controls will bring the official and black market rates for the peso in line. |
| Mr Coulton said the measures, alongside the devaluation and tightening fiscal and monetary policy, and rising interest rates, should help reduce the country's deficit. | Mr Coulton said the measures, alongside the devaluation and tightening fiscal and monetary policy, and rising interest rates, should help reduce the country's deficit. |
| But he added: "Argentina needs tighter monetary and fiscal policy to reduce selling pressures on the peso. | But he added: "Argentina needs tighter monetary and fiscal policy to reduce selling pressures on the peso. |
| "At present the peso money supply is growing too fast creating inflation and excess demand for dollars at the official exchange rate." | "At present the peso money supply is growing too fast creating inflation and excess demand for dollars at the official exchange rate." |
| Rodolfo Rossi, an economist in Buenos Aires, said: "This is a relief but it is not freedom. In practice, it gives just a little escape. The pressure on the (black-market peso) is going to continue." | Rodolfo Rossi, an economist in Buenos Aires, said: "This is a relief but it is not freedom. In practice, it gives just a little escape. The pressure on the (black-market peso) is going to continue." |
| In 2002, millions of Argentines saw their incomes and living standards collapse amid a crisis that included a government default on international debts and 41% inflation. | In 2002, millions of Argentines saw their incomes and living standards collapse amid a crisis that included a government default on international debts and 41% inflation. |