Argentina to further limit access to dollars-source
BUENOS AIRES May 23 (Reuters) - Argentines will face a higher barrier to buying dollars under a new government policy limiting the amount of greenbacks they can withdraw using credit cards overseas, a government source with knowledge of the policy told Reuters on Thursday.
Double-digit inflation and lack of confidence in the government's unorthodox economic policies has increased demand for U.S. currency and driven down the value of the peso.
The breach between the official exchange rate and the black market rate is now at about 70 percent, as Argentines shun the local currency.
The amount of dollars that Argentines could extract with their credit cards in other countries used to depend on bank rules and individual credit conditions. Under the reform, they will be allowed to use their cards to get $100 per quarter in countries bordering Argentina and $800 per month elsewhere.
"The banks will let their clients know about the new policy over the days ahead," said the source, who asked not to be named due to the sensitivity of the matter.
Argentina's government virtually banned foreign currency purchases in the country a year ago to stem capital flight and safeguard dollars to pay for imports and repay debts. The controls have gradually tightened since then.
Earlier this month the government urged middle-class dollar savers and rich investors holding assets overseas to declare their greenbacks through a tax amnesty plan meant to shore up the wobbly peso.
Dollar demand has increased due to inflation estimated by private analysts at about 25 percent a year and mounting fears the peso could depreciate at a faster rate. The South American country has a long history of devaluations and economic crises.