Argentina plans to ease currency controls after letting the peso devalue by the most in 12 years, reversing policies that caused reserves to decline and spawned a burgeoning black market amid accelerating inflation.
The cost to insure Argentine debt and the extra yield investors demand to own its bonds jumped to a three-month high.
Argentines will be able to buy dollars in proportion to their income, and a 35 percent redeemable tax on buying foreign currency will be cut to 20 percent, Cabinet Chief Jorge Capitanich said today in Buenos Aires. Currently, Argentines are often denied requests to buy dollars from the central bank, fueling illegal street trading in which the peso changes hands at as little as half the value.
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