Contagion Hits Latin America: Argentine Peso, Brazilian Real Plummet
- Contagion Hits Latin America: Argentine Peso, Brazilian Real Plummet
by Tyler Durden, https://www.zerohedge.com/
While the Turkish collapse has managed to stabilize (if that’s the right word) for the time being, it appears Europe’s close has refocused attention on South American EM as the peso and and real plunge.
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First, Argentina is attempting to force its banking system to shift away from short-term funding, has canceled the daily dollar auction and phased out its short term Lebacs (bills) program amid concerns of successful rolling over, offering 1-year notes and beyond instead. The peso reacted badly immediately.
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However, the central bank then stepped in and just unexpectedly hiked 7-day rates by 500bps to 45%.
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read more.
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