REUTERS/ By / A Goldman Sachs economist says the peso’s slide to a record low against Brasil's real is boosting exports of cars and wheat there and stoking an inflation that may hit at least 25% this year.
Argentina's GDP may hit 9.5 % this year, its fastest pace since 1992, as the weaker peso helps boost exports but also feed the highest inflation in the world after Venezuela.
Economist Alberto Ramos warns: “The economy is growing on steroids, generating a lot of inflation. This is not a sustainable cycle. They want to stimulate net exports, not through genuine productivity gains, but by giving them a competitive exchange rate.” Most economists forecast that Argentina’s peso will fall to 4.10 per dollar by the end of the year, from 3.9513 today.
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