There is already talk of issuing $ 5,000 bills in Argentina

Amid the coronavirus pandemic and rampant inflation in Argentina, economists from the National government are already thinking of issuing $ 5,000 bills.

The information was confirmed by two official sources to Clarín, although they specified that it would not be in the short term. There is no specific release date.

In 2017, when the $ 1,000 bill was issued, it was worth $ 56. Today, just over 8, if the calculation is done with blue.

Rodolfo Gabrielli, a former Mendoza governor and current president of Casa de Moneda, works on the project to issue $ 5,000 bills.

The issue depends on the Central in its capacity as monetary authority, but it is the Mint that is in charge of printing.

Several reasons would indicate that the economy needs a banknote of such a denomination. In the first place, because the inflationary erosion that leads to less purchasing power of the banknote with which previously more goods could be accessed.

Eco Go analyst Juan Paolicchi explained to Clarín: “with the Indec inflation until March and assuming that April gives 1.1% a $ 1000 bill, today it allows you to buy goods for $ 400, that is, it lost a 60% of its value. This is consistent with a cumulative inflation of 150%, that is, the price index multiplied 2.5 times. “

It is calculated in the same way with the $ 5,000 bill, it would be worth 55 dollars, if we calculate it in terms of the solidarity dollar, and almost 42 dollars according to the informal market.

“Inflationary dynamics lead to people demanding much more cash in times of pandemic for a precautionary matter,” Paolicchi said.

“He does not know when he will be able to go to the bank, if he will be able to leave. People prefer to keep the cash in their pockets to face buying futures, so they tend to take out more and more bills and banks have to replace each time more often and that generates a cost not only for the entities but for the Mint that has to print that silver, “he added.

The latest available data indicates that new impressions are concentrated on the $ 1,000 bills.

The bankers are others who defend the issuance of the new ticket, arguing that the transportation of flows is very expensive. “It generates unnecessary costs in human resources, which divert attention from more productive tasks and increases the cost of transportation. In addition, the problems of lack of money in ATMs on long holidays, for example, would end, since it would increase the carrying capacity and at no additional cost from the banks, “they indicated.

Written by Argentina News

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