Argentina appears among the top positions in a ranking, but not because of a favorable data, if not quite the opposite. According to a Bloomberg ranking that compares how the world currencies fared against the dollar, the Argentine peso ended up being the second most devalued currency against the dollar in 2021. While the local currency lost 17.85%, the lead was the Turkish lira with a drop of 44.88%.
In a period that goes from January 4, 2021, to this Wednesday, January 5, among the 10 currencies that lost the most against the US currency are: the Turkish lira, the Argentine peso, the Chilean peso, the Colombian peso, the Thai baht, the South Corian won, the Romanian lei, the Peruvian sol, the Hungarian forint and the Polish zloty.
In the 13th position among those with the greatest losses, the Brazilian real appears, with a drop of 7.38%, less than half of what the Argentine peso lost.
On the other hand, the Taiwanese dollar, the Chinese renminbi (or yuan) and the Hong K dollar were the least devalued against the US dollar in 2021. The first and second were neutral, while the third only subtracted 0, 52%.
If the ranking is cut, and only the share of the currencies in Latin America versus the greenback, there yes Argentina appears first. Closely followed by the Chilean peso, which registered a drop of 16.88%. In third place appears, the Colombian peso with a drop of 15.90%.
In fourth place, and among those that registered single-digit losses is the Peruvian sol, with a drop of 8.32%. While in fifth place, the Brazilian real was located, with a decrease of 7.37% and in sixth place, the one that devalued the least was the Mexican peso, only 2.35%.
According to the Bloomberg report, all the major currencies in Latin America lost value last year when compared to the United States dollar. It is that while the weaker economies were the most affected by inflation, many middle and high income countries depreciated their currencies. Added to this is the panorama posed by the pandemic, with the closure of the border and restrictions, in addition to the economic volatility of the countries.
The reasons for the drop in the value of the Argentine peso were extensive negotiations with the International Monetary Fund (IMF), speculation for a greater devaluation, the differences between the official dollar and the parallel, inflation and the rise in public debt .
The outlook for the next few months is not entirely encouraging. The possibility of an acceleration in the devaluation of the local currency rings with increasing force. For Leonado Svirsky, of Bull Market Brokers, “Although Argentina accompanies the rest of the world in something, everyone talks about accelerating the devaluation, some say 20%, others more, but for now they are just rumors “, although for the analyst there is a real data and it is that” for now they are going to continue with the daily devaluations. “However, in their opinion they have to wait because “summer is long.”
For his part, the economist Salvador Di Stéfano highlighted that “the devaluation of the official is projected for March, time passes and the devaluation runs, we continue worse. “For the market analyst, from February to March the annualized rate of future dollar positions will go from 48.7% to 52.8%, at a rate of almost 4 points Then, during the remainder of the year, the indicator will remain above 50%.