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As Argentina continues to fall president Fernández says merit is not valid for growth

Last Tuesday in the province of Jujuy, President Alberto Fernández repeated for the second time in the last weeks that his administration will terminate a merit-based system, to be replaced by a more active State controlling the economy in the same way Hugo Chávez started to do in Venezuela. “It is not true that merit is what makes us evolve or grow, as we have been led to believe in recent years. The dumbest of the rich has a better chance than the smartest of the poor. Until that changes, we cannot be calm with our conscience. That unequal treatment puts us in a bad place as a society. It is not a good system. The best societies are those that, precisely, give everyone the opportunity to develop ”, he said.

Central Bank tightens currency controls as peso weakens
The Central Bank has tightened conditions for the purchase of foreign currency, to prevent hoarding, preserve reserves and discourage demand for US dollars.

The existing quota of US$200 per citizen per month, put in place last year by the Mauricio Macri administration, remains in place, the Central Bank said.

"The initiative intends to maintain the current monthly quota of US$200, but discourage the demand for foreign currency made by human persons for the purposes of hoarding and card expenses," the institution said in statement.

The measures by President Alberto Fernández's government seek to reduce the gap between the official exchange rate and the black market (or dólar blue), which has soared to more than 70 percent as the country’s net international reserves have dwindled to less than US$7 billion.

Argentines have been buying dollars at a record pace as the peso loses value almost every day, pushed by some anti-business government decisions, an economy in free fall due to the pandemic and lack of saving options. More than 3.9 million people, or almost 10 percent of the country’s population, purchased greenbacks in July, according to recently published Central Bank data.

Inflation in August reached 2.7%
Consumer prices in Argentina increased 2.7 percent in August, the INDEC national statistics bureau announced Wednesday.

The data indicates that inflation is on the rise – prices rose by 1.9 percent in July.

Despite the efforts of the government, which has placed restrictions on the prices of goods in the basic food basket, food and beverages grew the most in August, rising 3.5 percent. Home equipment and maintenance also rose by the same amount.

INDEC also said that wholesale prices had risen by 4.1 percent in August, accumulating increases of 14.7 percent this year so far.

In its budget proposal, sent to Congress late Tuesday night, the government forecast that inflation in 2021 will reach 29 percent. This year, the rate is expected to reach 40, according to the most recent survey of economists by the Central bank.

Source: Buenos Aires Times (1) & (2) / Infobae
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