Interest rates hit 60% after peso plummets in value
Argentina hiked interest rates to 60% as it took dramatic steps to restore confidence in its plunging currency, in the latest sign of turmoil among emerging market economies this year.
The Argentinian central bank raised the cost of borrowing by 15 percentage points last week in an attempt to shore up the peso, which has plummeted in value. The central bank said it would keep rates unchanged at 60% until at least December.
Having approached the IMF for emergency support of $50bn amid an unfolding economic crisis, Argentina asked the Washington-based lender of last resort to accelerate the release of the money to bolster its finances. Argentina’s president, Mauricio Macri, has said a lack of trust from the markets had forced him to ask for help as the peso weakens and inflation runs at 30%.