Argentina announces devaluation of currency by over 50% to boost economy

The new Argentinian government is preparing to devalue the national currency by more than 50% as part of emergency measures to help the nation’s struggling economy.

As reported by CNN, the country’s new Economy Minister Luis Caputo announced this move on December 12, which will see the official conversion rate rise to 800 pesos per dollar from 365 pesos, only days into Javier Milei’s term as new president.

Milei campaigned on a pledge to get rid of the peso and replace it with the dollar in order to get the economy back on track, as it had been artificially supported for years by strict capital controls while its value has plunged roughly 52% this year against the US dollar.

The move marks the first of several steps to control hyperinflation, which led Argentina’s central bank in October to increase its benchmark interest rate to a staggering 133%.

The International Monetary Fund said it welcomed Caputo’s remarks that it supports the new initiatives aimed at strengthening the foreign exchange regime.