Economics

In the News

Argentina raises interest rates to 40 percent

Graham Watson

5th May 2018

Lots of coverage as you would expect about the state of the Argentinian economy, with news that the central bank has raised interest rates three in a week, rates leaping from 27.25% to a staggering 40%.

Inflation has been a perennial problem in the country, and this move is designed to counter a depreciation of the peso. However, moves such as this can only work if investors have confidence in the ability of the central bank to arrest the slide; if it's interpreted as a sign of weakness the move might well have counter-intuitive effects.

Graham Watson

Graham Watson has taught Economics for over twenty years. He contributes to Tutor2U, reads voraciously and is interested in all aspects of Teaching and Learning.

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