This week, the Argentine government intends by decree to announce new financial measures, such as recalling dollar-denominated foreign-rights bonds from public entities and forcing them to place some of their dollar-denominated local-rights bonds on the open market.

About $4 billion worth of foreign-rights bonds is supposed to be exchanged for peso-denominated debt.

The fact is that the world’s largest grain producer must address the depletion of foreign reserves, the drought that has hit exports, annual inflation of over 100%, and the pressure on the national currency, the peso, which leads to higher dollar-denominated prices in unofficial markets.

Such a measure would allow the government to absorb the excess peso in the market, which further fuels inflation, reduces dollar debt and gains leverage to intervene in the foreign exchange market without sacrificing reserves.

This will help reduce the volatility of the dollar market in particular, and the capital market in general, thereby avoiding the impact on inflation.

Government agencies that previously bought government bonds would pay back part of their dollar debt under local law to the market, with the rest going back to the central government. They will also now have to pay back their dollar debt to exchange it for local currency debt.

The peso has depreciated sharply against the dollar on the unofficial market in recent days, reaching a record low on Tuesday amid a prolonged drought and growing fears of a shortage of foreign exchange in the market following a decline in grain exports. The gap between the official peso exchange rate and the popular unofficial rate is nearly 90 percent.

Earlier, we reported that experts doubted the ability of Moscow and Beijing to challenge the dollar.