All articles tagged with #currency crisis
Argentine President Javier Milei faces a critical midterm election amid economic turmoil, declining approval, and corruption scandals, with the outcome crucial for his legislative agenda and economic stability, especially given the recent U.S. bailout and currency crisis.
Argentines are rapidly losing confidence in the peso despite US financial support, with residents betting on a devaluation after upcoming elections, as government efforts to stabilize the currency prove increasingly ineffective amid political and economic instability.
Argentina, led by President Javier Milei, faces a severe currency crisis despite implementing shock therapy reforms, prompting the US to provide a $20 billion currency swap to support the peso, marking a significant geopolitical and economic intervention that highlights US influence and regional tensions.
The US has purchased Argentine pesos and finalized a $20 billion financial rescue plan to stabilize Argentina's currency crisis, supporting President Milei's reform agenda amid domestic and international scrutiny, with some US political backlash over the support's implications.
Russia's ruble remains weak, valued at less than a penny, despite the central bank's halt on foreign currency purchases. The ruble has fallen 20% against the dollar this year, exacerbated by U.S. sanctions on Russian banks. While this could make exports cheaper, it risks increasing inflation due to more expensive imports. Russia's sovereign wealth fund, used to support the ruble, has dwindled from $140 billion to $55 billion since the Ukraine invasion, leaving the economy vulnerable to energy price fluctuations. The central bank maintains high interest rates, but further hikes could strain the economy.
Nigeria is grappling with a severe currency crisis and soaring inflation, with almost 10% of the population facing food insecurity. The government's economic reforms, including the removal of fuel subsidies and relaxation of currency controls, have led to short-term macroeconomic issues. The International Monetary Fund has urged the country to address rising food insecurity as an immediate policy priority and commended the government's efforts to implement a social protection system. However, challenges such as high inflation, naira weakness, and policy tightening continue to pose significant headwinds to economic growth, while private sector momentum has slowed due to high input prices and output cost inflation.
Abu Dhabi has pledged to invest $35 billion in Egypt to help ease its currency crisis, providing a significant boost to the country's struggling economy. The investment is expected to support Egypt's foreign exchange reserves and help stabilize its currency, which has been under pressure due to the economic impact of the Covid-19 pandemic. This move reflects Abu Dhabi's commitment to supporting Egypt's economic development and strengthening bilateral ties between the two nations.
The Argentine peso has experienced a significant drop in value as presidential candidate Javier Milei advocates for the adoption of the US dollar as the country's currency, a move known as dollarisation. Milei's proposal comes amidst a currency crisis in Argentina, with the peso losing value against the dollar.
Argentina, facing a severe shortage of US dollars, is now allowing commercial banks to open deposit accounts in the Chinese yuan. The move comes as the Argentine peso has plummeted nearly 80% against the US dollar since the start of 2020. The country has been increasingly using the yuan as an alternative currency, paying for imports from China in yuan and making a $2.7 billion payment to the International Monetary Fund in the Chinese currency. The shortage of dollars is due in part to a drought that has impacted the country's agriculture exports, leading to a decline in dollar reserves. The surge in yuan usage in Argentina has opened an opportunity for China to increase the global circulation of its currency.
Turkey's lira hit a new record low against the US dollar after President Recep Tayyip Erdogan won the presidential election, extending his rule into a third decade. The lira has lost more than 90% of its value over the past decade, with the economy in the grip of boom-and-bust cycles and rampant bouts of inflation. Erdogan's victory has seen further pressure on the Turkish lira, despite Turkish stocks enjoying gains. Critics blame the years of economic turmoil on unorthodox economic policies, which the opposition had pledged to reverse.
Turkey's lira slipped towards a fresh record low against the dollar as President Tayyip Erdogan claimed victory in the country's presidential election on Sunday. The lira has lost more than 90% of its value over the past decade with the economy in the grip of boom and bust cycles, rampant bouts of inflation, and a currency crisis. Erdogan's victory is unlikely to embrace an outright economic orthodox approach, but some adjustments to the current heterodox approach could be adopted with the aim of gaining time ahead of the March 2024 local elections.
Turkey's lira slipped towards a fresh record low against the dollar as President Tayyip Erdogan claimed victory in the country's presidential election on Sunday. The lira has lost more than 90% of its value over the past decade with the economy in the grip of boom and bust cycles, rampant bouts of inflation and a currency crisis.