22 December 2017
EM Currency Handbook 2018: Still Fuel in the Tank
remunerated deposit for some FX inflows. Abolishing
the FX controls prompted the peso to depreciate by
30% against the USD in December 2015, prompting
the central bank to raise interest rates to mitigate the
inflationary effects. Since then, the ARS has
depreciated further, keeping up with persistently high
inflation rates in excess of 40% YoY. The ARS is now
considered a fully floating currency by the IMF. Going
forward, we expect the real exchange rate to remain
relatively stable, as the adverse effect of higher interest
rates in the US will probably be offset by rising inflows
of foreign direct investment as the economy gradually
recovers. Therefore, we expect the nominal exchange
rate to keep on depreciating mostly in tandem with
inflation.
Deutsche Bank Securities Inc. Page 91
CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0076894
CONFIDENTIAL SDNY_GM_00223078
EFTA01379426