### Summary
Inflation in Argentina has reached 113%, pushing 40% of the population into poverty, as the country faces an economic collapse that could see the far-right return to power under Javier Milei, a rock-singing former sex coach who has threatened to abolish the central bank.
### Facts
- 💸 Argentina is experiencing an economic collapse with annual inflation reaching 113%, its highest in over 30 years.
- 💰 Inflation has pushed 40% of the population into poverty as soaring prices outpace wages.
- 📉 The crisis escalated when the central bank raised interest rates to 118% to halt a sell-off in government bonds and the Argentine peso, which hit a record low against the dollar.
- ⬇️ Inflationary pressures forced officials to devalue the peso by 18% on Monday, which some economists believe may fuel further inflation, possibly reaching 150%.
- 🏛️ The far-right, led by Javier Milei, a rock-singing former sex coach, has gained popularity and threatens to abolish the central bank if they come to power.
- 🌎 This serves as a stark contrast to the inflation battle faced by the Bank of England, where inflation stands at 6.8% and interest rates have been raised to 5.25%.
### Summary
Global dedollarization efforts are facing a credibility challenge as currencies such as the Russian ruble, Chinese yuan, and Argentine peso suffer significant declines, highlighting the perceived stability and reliability of the US dollar.
### Facts
- 📉 The Chinese yuan, Russian ruble, and Argentine peso have all experienced significant declines in value recently, causing their respective central banks to take measures to stabilize their currencies.
- 🌍 These declines come at a time when countries like Russia and China are actively trying to reduce their reliance on the US dollar in trade and investments, a trend known as dedollarization.
- 💰 However, the recent exchange-rate turmoil and instability of these currencies against the US dollar could undermine the dedollarization efforts and raise questions about the feasibility of finding a common currency to combat the dominance of the dollar.
- 💱 Dedollarization efforts in Argentina have been limited, with some even advocating for adopting the US dollar as the local currency to combat hyperinflation.
- 🌎 While the share of the US dollar in global reserves has decreased over the years, it still makes up nearly 60% of the world's foreign-exchange holdings, highlighting its long-standing dominance as the world's reserve currency.
Note: The text provided is truncated, so the summary and bullet points may not capture the complete context of the original text.
The Argentinian peso weakened against the dollar on the black market while stocks rose as investors awaited the approval of Argentina's loan program by the International Monetary Fund (IMF) board, following a staff level agreement in July.
Argentina should consider pegging its currency to Brazil's real instead of the US dollar, as it would help address economic problems such as exchange-rate instability and hyperinflation, according to an economist.
Mexico's peso rose against the dollar after central bank minutes and inflation data indicated that interest rates would remain on hold for longer, while the BRICS group invited Argentina and five other countries to join the bloc.
Latin American currencies are under pressure from a strong dollar as traders await remarks from Federal Reserve Chair Jerome Powell on U.S. interest rates, while the Chilean peso reaches a three-week high; meanwhile, Argentina stocks are seen as a "safeguard of value" amid economic turmoil, but the country faces opposition to joining the BRICS bloc.
Bitcoin's price, adjusted for inflation, has remained relatively static since reaching its all-time high of $20,000 in 2017, despite reaching as high as $69,000 in the meantime.
Argentina is facing the highest triple-digit inflation in over three decades, potentially reaching near 200% by year-end, which is causing increased poverty, anger among voters, and memories of past economic crises.
El Salvador's experiment with making bitcoin an official currency is difficult to analyze due to its opaque nature and multiple objectives, including financial inclusion, revenue generation, and enhancing the president's reputation. The country has made bitcoin purchases, but the exact amount is unknown, and it has experienced a loss of value in its bitcoin investments. The government's digital wallet, Chivo, faced security issues, and the adoption of bitcoin for transactions and remittances has been limited. Comparatively, Argentina has surpassed El Salvador in terms of bitcoin adoption. The move to bitcoin has garnered attention for El Salvador but has also raised concerns about the lack of a coherent educational process for mass adoption.
The dollar's status as a global reserve currency is facing challenges as countries like China and India promote trade in their own currencies, digital currencies gain popularity, and geopolitical conflicts threaten the international monetary system dominated by the dollar.
Argentina should avoid dollarizing its currency and learn from Ecuador's experience, as it could lead to a prolonged period of economic weakness, according to economist Robin Brooks.
Most Latin American currencies fell as the dollar strengthened on robust U.S. economic data, with the Mexican peso leading the declines, while Chile's peso gained after the central bank cut its benchmark interest rate and lowered its economic growth forecast for 2023.
Argentina's peso currency is at risk of another devaluation after the upcoming presidential election, with estimates suggesting a 16.6% devaluation in the three months following the vote.
Argentina's Consumer Price Index likely rose 11.8% in August, the highest monthly figure since 1991, due to a sharp devaluation of the local peso currency and the country's ongoing inflation crisis.
Bitcoin trades at $25,933, up 0.66% as U.S. CPI data is anticipated to show a small increase in August, driven by rising oil prices, while digital assets remain stable due to short covering and liquidity crunch, although a sustained bullish momentum is yet to be seen; meanwhile, the price of CRV token falls by 3.3% following negative events and selling pressure.
Argentines face daily challenges in trying to find deals and lower prices as the country's inflation skyrockets above 100%, leading to a cost-of-living crisis and increased poverty levels.
Argentina's dollar scarcity should not prevent the country from adopting the dollar as its currency, according to economist Francisco Zalles, who believes that dollars would flow back into Argentina once it makes the switch and that Javier Milei's plan to dollarize would be successful. However, other commentators have warned that adopting the dollar without ample reserves could have catastrophic consequences.
Argentina is facing skyrocketing inflation, with consumer prices soaring by 12.4 percent in August and an annual inflation rate of 124.4 percent, putting the ruling coalition on the defensive ahead of the upcoming presidential race.
Real estate is considered a reliable store of value, although rising interest rates have led to stagnant mortgage demand, while Bitcoin and cryptocurrencies like it may offer a more reliable store of value in the current economic climate.
Inflation in Argentina has caused poverty levels to rise, with 40.1% of Argentines living in poverty, and the country is heading towards its sixth recession in a decade, leading to increasing despair ahead of the upcoming election.
Bitcoin is outperforming the US dollar in terms of beating inflation, as shown by the St. Louis Federal Reserve's comparison of the prices of a dozen eggs in both currencies since January 2021.
The handwritten notebooks of a Buenos Aires barber chronicle the devastating impact of Argentina's 19,900% inflation over several decades, with current President Alberto Fernandez overseeing the fastest price rises in the past 30 years, driving up poverty rates and causing a decline in purchasing power.
The notebooks of a Buenos Aires barber chronicle 19,900% inflation in Argentina over three decades, with current President Alberto Fernandez experiencing the fastest price rises of any administration, creating a cost of living crisis and driving voters towards a right-wing radical.
Bitcoin remains steady at $28,000 amidst geopolitical instability, but as markets react to the war in Israel, volatility may increase, especially with upcoming macroeconomic triggers and on-chain metrics suggesting interesting times ahead for BTC price.
Argentina's peso hits a historic low of 1000 pesos per US dollar on the black market as the country's inflation remains high and uncertainty ahead of the presidential elections increases demand for hard currency.
Bitcoin (BTC) remains stable as U.S. inflation data surpasses expectations, leading to uncertainty in monetary policy and the Federal Reserve's ability to cut interest rates; market participants are cautious about a potential upside for BTC in the short term.
Argentina's central bank has raised its key rate for the sixth time this year to 133% in an attempt to control inflation, which has surged above 100% ahead of the presidential election; however, economists believe the rate hike will have little impact as it is coupled with money printing and falls below inflation in real terms.
