LatinNews Daily - 27 September 2023

In brief: Argentine oil sector given access to preferential exchange rate

* Argentina’s economy minister, Sergio Massa, the candidate for the ruling Peronist coalition Unión por la Patria (UP) in the October presidential election, has announced that the oil sector will have access to the more favourable CCL exchange rate for the next 60 days. The move, aimed at incentivising oil exports and boosting the country’s reserves of US dollars, will enable oil companies to exchange 25% of their total export revenue into pesos using the CCL rate. The CCL is one of a number of complex exchange rate mechanisms which aim to preserve scarce foreign currency; on the CCL, US dollars are currently trading at Ar$775.5/US$1, which is over twice their value on the official exchange rate where they currently trade at Ar$350/US$1. Massa said that allowing the oil sector to temporarily access the CCL exchange is expected to bring in an additional US$1.2bn, which he said would strengthen the central bank (BCRA)’s dollar reserves and strengthen financial and monetary stability.

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