Argentina returns to currency controls as debt crisis spirals

Argentina imposes currency controls to support economy

The IMF said it was studying the new measures taken by the Macri government.

According to the decree, the BCRA will establish under what circumstances "purchasing foreign currency and precious coins, and transferring them overseas, will require prior authorization".

The decision was seen as a blow to anti-interventionist president Mauricio Macri's administration as his supporters and financial markets eye national elections next month that polls suggest will see leave his left-leaning rival triumphant.

On September 1, the Central Bank of Argentina imposed restrictions on purchases in U.S. dollars (USD), trying to revive its falling currency, peso.

"Given various factors that impacted the evolution of the Argentine economy and the uncertainty in the financial markets, the executive branch needed to adopt a series of extraordinary measures aimed at ensuring the normal functioning of the economy, sustaining the level of activity and employment and protecting consumers", said the decree published in an official bulletin on Sunday.

Individuals seeking to buy dollars now face a monthly limit of $10,000 (€9,100).

Since Argentina held primary elections on August 11, the BCRA has sold some 2.038 billion dollars in reserves to shore up the national currency.

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She's now the front runner for the presidential election proper on October 27.

"Staff will remain in close contact with the authorities in the period ahead and the Fund will continue to stand with Argentina during these challenging times", the Fund said in a statement.

Exporters, on the other hand, are required to liquidate their foreign exchange (forex) earnings in the local market under deadline i.e., five days.

On Friday, the peso slid another 1.74 pesos against the dollar, devaluing a total of 33.2 percent compared with August past year.

Last week, Lacunza said the government would negotiate with holders of its sovereign bonds and the International Monetary Fund to extend the maturities of its debt obligations as a way of ensuring Argentina's ability to pay.

Fernandez de Kirchner, in office from 2007 to 2015, clamped down on access to US dollars in a bid to protect the central bank's precarious reserves.

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