September 28, 2018 / 1:43 PM / 2 months ago

Argentine peso falls 3 pct amid skepticism to IMF-backed policies

BUENOS AIRES, Sept 28 (Reuters) - Argentina’s peso fell 3.17 percent to 41.00 per dollar after opening amid strong buying interest in the U.S. currency in the wake of changes to monetary policy announced under a new IMF deal, traders said on Friday.

Argentina announced a revised $57 billion financing agreement with the IMF on Wednesday that foresees allowing the peso to float freely without central bank intervention between 34 and 44 pesos per dollar. It also aims to completely halt a rapid growth in the monetary base.

“Traders understand the new IMF agreement is great news for fiscal policy but our first impression is that the new monetary policy is extremely rigid and creates great risks for economic activity, especially if annual inflation surpasses 40 percent in September,” a report from SBS consultancy said.

The peso, which has lost more than 50 percent of its value against the dollar this year, touched a historic low of 42 per dollar in August. (Reporting by Walter Bianchi, Writing by Scott Squires Editing by Daniel Flynn)

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