The official exchange rate for the U.S. Dollar closed at 1,400 Argentine pesos for wholesale transactions on Monday, marking a weekly decline of 16 pesos, according to the Central Bank of Argentina. This follows a 19-peso increase the previous week, and positions the rate 16.28% below the upper limit of the established band, currently at 1,627.97 pesos.
Despite ongoing global economic uncertainty stemming from escalating tensions in the Middle East, the Argentine peso demonstrated resilience. Banco Nación offered a retail rate of 1,410 pesos per dollar on Monday, while other major banks posted varying rates: Banco Galicia and Banco Credicoop at 1,410 pesos; Banco BBVA, Banco Santander, Banco Ciudad, Banco Patagonia, Banco Macro, Banco Supervielle, Banco Piano, and Banco Comercio at 1,415 pesos; ICBC at 1,415 pesos; and Brubank at 1,414 pesos.
The intensification of the conflict in the Middle East has dominated the financial landscape, impacting both international markets and Argentine assets. The uncertainty has led to a decline in Argentine sovereign bonds and a rise in the country’s risk premium. However, the local currency market has resisted the broader global strengthening of the dollar.
Wall Street’s main indices – Dow Jones, S&P 500, and Nasdaq – experienced weekly losses of up to 2% as investors adopted a cautious stance amid the evolving situation in Iran. The price of Brent crude oil, a benchmark for Argentina, surpassed $103 per barrel on Friday, reaching its highest level since 2022, with a weekly increase of nearly 12% and a monthly gain of 53%.
The S&P Merval index, representing the Argentine stock market, fell 1.96% on Friday, equating to a 3.03% decrease when measured in dollars. Despite this, the index concluded the week with a positive performance, increasing by 0.63% (or 1.31% in dollar terms). The country’s risk premium, as calculated by JP Morgan, currently stands at 584 points, a rise from its recent low of under 500 points in late January, reflecting increased investor concern regarding Argentina’s debt repayment capacity.
The Central Bank continues its intervention in the foreign exchange market, having purchased $70 million in the market last Monday, marking the 39th consecutive trading day as a net buyer of U.S. Dollars, with total purchases reaching $2.783 billion so far this year.
