The growth of the US dollar has seen a depreciation in emerging currencies around the region and the world over the last two weeks. The US presidential election seemed to have the same effect here in Argentina, as the dollar’s value rose to an 8 month high of $15.80 AR/USD as of November 15th.

Since then, the continued appreciation of the dollar has seen this trend continue throughout international economic scene. Argentina, however, has been an exception to the rule. After the dollar reached ceiling last Tuesday, we have seen five consecutive days of sustained increase in the value of the Argentine peso relative to the US dollar. Yesterday the Argentine peso rose five centavos to $15.63 ARS/USD. And in the wholesale market, where the dollar had also skyrocketed immediately after the election, the peso is also gaining value climbing up to $15.72 ARS/USD.

Yesterday’s significant value shift owes much to the upcoming bank-holidays. Buyers and sellers have been eager to make the most of current rates with holidays in the United States (24th and 25th) and here in Argentina (28th) approaching. That goes someway to explaining the volume of transactions and the extent of yesterday’s shift but it doesn’t explain the trend itself. So what’s going on? How is the Argentine peso appreciating despite the ‘Trump effect’?

Export liquidations

Today, figures have been released concerning the increased volume of export liquidations by agriculture exporters. Precisely due to the ‘Trump effect’, exporters looked to make the most of the sky-high dollar rate, resulting in a 20% increase in export liquidations, up to US $401 million. The increased volume of dollars in the country due to these opportunistic sales helped to mitigate the peso’s depreciation. But that alone could not have been enough to have turned the tables entirely.