Argentine President Says Currency Market Needs Order: Cohete

(Bloomberg) -- Argentina’s currency market is messy and must be “ordered,” President Alberto Fernandez said in an interview with local outlet El Cohete a la Luna.

In the wide-ranging interview, the leader complained that a mass exodus of dollars from the country, as well as sustained demand from citizens for dollar savings had put the country in a precarious position.

In mid-September, Argentina added severe restrictions on dollar purchases for individuals and companies, but the measures have done little to curb demand.

“When we arrived in December we found ourselves with a languid central bank, without reserves, empty, with few freely available dollars,” said Fernandez. “We want to prioritize the use of those dollars for purchases inputs for imports.”

A spike in the value of dollars in a parallel market used to skirt the controls has only made matters more complicated. Still, Fernandez said, assistance from the International Monetary Fund will help to sort out the nation’s currency issues.

“The currency market is very messy and we must order it,” he said.

Meanwhile, Cecilia Todesca, deputy cabinet chief, said in a separate interview with newspaper Clarin that the government’s measures will produce results, but not in the short term. She added that the country’s currency plight could not be solved by a “brutal” change of policy, such as a large devaluation.

“Issues in the currency market reflect structural problems,” she said. “If all Argentines want to save in dollars, the economy does not work.”

The president also sought to play down reports that Economy Minister Martin Guzman and central bank chief Miguel Pesce are at odds over the crackdown on dollar purchases.

“There were no divergent positions but debates,” Fernandez in the interview. “We heard each other, we made a decision and we carried it out.”

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