Photo released by the Central Bank of Argentina showing the new 10,000 peso note (Central Bank of Argentina/AFP/Handout)
Barely a year after launching a 2,000 peso note, Argentina, with inflation still out of control and the currency still fragile, launched a 10,000 peso note on Tuesday, the largest denomination now in circulation.
The Central Bank (BCRA) announced the circulation of the 10,000 pesos note (approximately 11 dollars), in particular “to facilitate transactions”. And, “for the last quarter of the year”, the launch of a 20,000 peso note.
Exactly one year ago, the previous government (Peronist, center-left) launched a 2,000 peso note ($8.50 at the time at the official exchange, but $2.20 now), to face a continued depreciation of its currency and already devouring inflation (+211% for the year 2023).
The government has changed and the new ultraliberal president Javier Milei is administering an austerity cure to the economy and the State, after a sharp devaluation. But inflation is slow to come down (+51% in the first quarter), and the peso, although stabilized around 900 to the dollar, is still overvalued in the eyes of many economists.
The government prefers a slow, sliding and controlled depreciation, but the banks demanded denominations larger than the 2,000 peso note. Currently, with 2,000 pesos you can buy a coffee and a “media luna” (mini local croissant) in Buenos Aires in a rather low-end establishment.
The new denomination bears the effigies of Manuel Belgrano and Maria Remedios del Valle, heroes of independence.
The entry into circulation of these new denominations raises the question of the future of those of 10 or 20 pesos (1 or 2 cents), which consumers and merchants no longer even count, underlines the press. However, cash remains crucial in a very informal economy: 47% of informal work, according to the International Labor Organization.
© 2024 AFP
Did you like this article ? Share it with your friends using the buttons below.
