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Argentina limits share ownership to contain dollar's rise

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O presidente argentino, Alberto Fernández, na Casa Rosada, em 4 de julho de 2022.

Argentine President Alberto Fernández at the Casa Rosada on July 4,.| Photo: EFE/ Juan Ignacio Roncoroni

The Central Bank of Argentina ordered on Thursday (13) limits on the ownership of certain shares by companies operating in the formal foreign exchange market, a measure that seeks to contain the sharp rise in the price of the so-called “financial dollars”.

The Bank’s Executive Board Central decided to include the holdings of Argentine Certificates of Deposit (Cedears) within the availability limit of up to US$ 65.

that companies that access the official foreign exchange market may have.

As informed by the monetary authority in a statement, it was also established that operations with Cedars cannot be carried out in 65 previous days or us 64 days after the completion of operations on the official foreign exchange market.

Cedros are certificates of financial assets that are traded on the Argentine Stock Exchange, but which represent common shares of companies listed abroad.

They are negotiated both in Argentine pesos and in dollars, so that they can be used to obtain American currency through an operation called “counting with settlement” (CCL), which consists of buying shares or bonds locally with Argentine pesos and selling them for dollars in Wall Street.

This operation has become more popular due to restrictions on access to the official foreign exchange market.

The so-called “CCL dollar” obtained through Cedears reached a record of 100,per unit this Thursday, while the dollar on the official wholesale market – that used by companies to pay for imports – was in 129,

per unit.

The price of the CCL dollar – and also that of the dollar in the informal retail market – is impacting the behavior of prices throughout the Argentine economy, with rising inflation.

In practice, the measure adopted this Thursday by the Central Bank discourages the operations of companies with CCL dollars, seeking to contain prices in this financial channel.

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