Argentine black market peso hits record low

Argentina's peso edged up on Monday and the local Merval stock index rallied after center-left Alberto Fernandez clenched victory over incumbent Mauricio Macri in the presidential election and the central bank clamped down on dollar purchases. The peso was 0.02% stronger in morning trade at 59.98 per dollar, traders said. However, Argentina's black market peso split away, weakening 1.95% to 77 per US dollar, a record low. Another often-cited price, known as a blue-chip swap, held stable at 81.5 pesos per dollar.

In the early hours of Monday, Argentina's central bank announced it would tighten a restriction on dollar purchasing to $200 per month for individuals, down from $10,000 a month, until December, when the new government will be in place. Argentine dollar bonds earlier fell as investors fretted about the consequences for the national economy and debt burden after Fernandez ousted business-friendly Macri.

The benchmark international 2028 dollar bond dropped to 38.80 cents on the dollar, its lowest level since the start of the month, according to Refinitiv data. Argentina's markets are in the spotlight after the Sunday vote, which handed an outright victory to the country's Peronist opposition, who now face the daunting task of righting the country's economy and stabilizing markets. Key to that will be the relationship with the International Monetary Fund, which extended a $57 billion line of credit to Argentina in 2018 but has been holding off on disbursing the latest tranche of funds.

"We look forward to engaging with (Alberto's) administration to tackle Argentina's economic challenges and promote inclusive and sustainable growth that benefits all Argentines," IMF Managing Director Kristalina Georgieva tweeted on Monday.