“Dollar Rain” by Millie: Find out how Argentine banks have recovered billions under the current government

“Dollar Rain” by Millie: Find out how Argentine banks have recovered billions under the current government

During the period of storms that hit Argentina from October to March, the neighboring country saw a “rain of dollars” in the banks. Since the inauguration of Javier Miley as president on December 10, Argentines have deposited more than US$2.3 billion (R$11.4 billion) in banks, representing an increase of almost 17%, for a total of US$16.4 billion (R$81.5 billion) in the months The first three are from the government. This is according to data from the Central Bank of Argentina. This increase represents a full recovery of the previous year's losses.

In Argentina, current accounts are denominated in pesos, while savings accounts can be denominated in dollars. However, due to restrictions, only a few savers can afford to buy $200 per month, and in general, people choose to buy a MEP dollar or Bolsa dollar, which is less expensive than a savings dollar and complies with regulations.

Experts consulted by Bloomberg attribute the increase in deposits to the population's confidence in Miley's government. If this trend continues, it will be positive news for the central bank, as a portion of savers' dollar deposits contribute to international reserves, which, despite the monetary authority's dollar purchases, remain negative.

Dollar deposits in Argentine banks are considered an informal indicator of political risk, as people tend to deposit more money during periods of stability and withdraw during periods of volatility. During the elections in October and November last year, deposits fell, reflecting political uncertainty. The current increase represents a reversal of this trend, indicating increased confidence in political stability under the new government.

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With information from Seu Dinheiro, Clarín, and Bloomberg.

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About the Author: Camelia Kirk

"Friendly zombie guru. Avid pop culture scholar. Freelance travel geek. Wannabe troublemaker. Coffee specialist."

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