Argentines and the US dollar have a very special relationship and have come to know what to expect from each other. Within this scenario that Argentines are so used to, however, a lingering question remains: why exactly does this happen? “The ‘blue’ or parallel exchange rate is a true reflection of the market’s uncertainty regarding the economy,” Juan Ignacio Paolicchi, chief economist at Empiria Consultores, told the Herald. Informal exchange houses — cuevas, Spanish for caves— and street “blue” dollar sellers — arbolitos, Spanish for “little trees” — are a persistent part of Buenos Aires City’s landscape. This anxiety can also be seen in the rise of the implied interest rates for August and September future dollar contracts.

Source: Bueno Aires Herald August 11, 2023 15:23 UTC