The Argentine peso woes mount

Emerging-market assets held losses in Asian trading Tuesday, signalling Argentina’s plan to narrow its fiscal deficit and comments from Turkey’s central bank hinting at a rate increase have yet to shore up investors’ confidence.

An MSCI measure tracking developing-nation currencies fell for a second day, losing 0.2 percent as of 11:19 a.m. in Singapore, while the index tracking shares slipping 0.2 percent, after falling for the past four sessions. Indonesia’s rupiah weakened for a sixth day, sinking to a fresh two-decade low.

Argentina’s government announced emergency measures Monday, including new export taxes, after the peso tumbled 26 percent last month. Trading in the currency was too thin to judge if the plan was a success or not, with that market verdict set to come Tuesday. In Turkey, the central bank vowed to reshape its monetary policy stance at a Sept. 13 meeting after consumer inflation accelerated faster than expected in Augus

‘A Penny Short’

Stephen Innes, head of Asia Pacific trading at Oanda Corp. in Singapore:

  • Argentina’s measures are “likely a day late and a penny short”
  • “These moves are a step in the right direction, but they’re unlikely to be convincing enough to remove currency speculators from the driver’s seat. I guess it’s all down the IMF’s ‘White Knight’ to the rescue. However, we are getting into the realm of unquantifiability which makes the market utterly untradable”

Bloomberg

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Stephen Innes

Stephen Innes

Head of Trading APAC at OANDA
Stephen has over 25 years of experience in the financial markets and currently based in Singapore as the Head of Trading Asia Pacific with OANDA. Stephen's market views focus on the movement of G-10 and ASEAN Currencies. His views appear in Bloomberg, CNBC.Reuters, New York Times WSJ and the Economist. His media appearances include Bloomberg TV & Radio, BBC International, Sky TV, Channel News Asia, ASTRO AWANI and BFM Malaysia. Stephen has an extensive trading experience in Spot and Forward FX, Currency and Interest Rate Futures, Money Market Derivatives and Precious Metals. Before joining OANDA, he worked with organisations like Nat West, Chemical Bank, Garvin Guy Butler, and Sumitomo Mitsui Banking Corporation. Stephen was born in Glasgow, Scotland, and holds a Degree in Economics from the University of Western Ontario.
Stephen Innes