Argentina Peso Predicted to Fall in Value

Currency analysts are predicting a tough 2022 for Argentina, Latin America’s third largest economy. The Argentinian Peso is currently trading at 103.29 Pesos to the US Dollar, but is expected to tumble in the coming months, hitting a rate of around 165 Pesos per Greenback by the end of the year.

Argentina’s inflation is predicted to rise to a whopping 54.8% at the end of 2022, after central bank analysts were polled for their views last week. This projection represents an almost three percentage point gain from a similar survey in December 2021. On the upside, the economy is slated to grow by 2.9% in 2022, as per the same poll. This forecast represents a 2.5% gain from the previous poll.

Argentina has battled high inflation for years and is coming out of a recession that continues to be extended and exacerbated by the COVID-19 pandemic.

What does this mean for me?

In FOREX trading, you will often hear about distinct types of currencies – major, minor and exotic. The Peso is considered to be a minor currency based on Argentina’s economic position in South America.

As a FOREX trader, you can expect high volatility while you trade the currencies of developing nations. It is often difficult to track the swings of minor currencies, but in the case of Argentina’s Peso, there are plenty of warning signs that the rest of the year will bring a run of constant devaluation.