San José, Costa Rica, since 1956

Argentine peso loses 30 percent of value after controls lifted

BUENOS AIRES, Argentina — The Argentine peso lost 30 percent of its value on Thursday after the new pro-business government scrapped the foreign exchange restrictions introduced by its leftist predecessors.

At the close of trading on the first day without the currency limits, dollars were changing hands for 14 pesos, more than 42 percent higher than the closing rate on Wednesday.

New pro-business President Mauricio Macri, who took office promising deep reforms for Latin America’s third largest economy, had announced the move Wednesday.

Economists warned the country faces a rough adjustment.

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Charles House

Similar to what would happen to the CR colon if it floated on the open exchanges.

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In fact, the Costa Rica colon IS floating between an upper and lower limit.
And the colon has floated near the lower limit, not the upper limit.
In fact, the Costa Rica central bank has often intervened (as many central banks do) by buying US dollars on the open market to keep the dollar from weakening further, and the colon from strengthening further.
It is also not true, as we seem to like to believe, that the US dollar does and should get stronger against every country, especially developing counries.
For example, the Guatemalan quetzal has been even stronger than the colon against the US dollar.
For example, in Dec 2012 the quetzal was 7.9 to the dollar, and today it’s at 7.6.
The Costa Rica colon has weakened slightly from 509 in Dec 2012 to 531 today.
Sometimes facts do not support what we like to believe.

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