Argentina devalues peso after shock primary election result

The state banking institution, Banco Nacion, depicted the Argentine peso's exchange rate at 365.50 against the US dollar, reflecting an increase compared to the previous trading rate of 298.50 on the previous Friday.

Argentinian financial officials made the decision to decrease the value of their currency, the peso, by approximately 20 percent on Monday. This decision was made in anticipation of a negative reaction from the market due to the impressive performance of far-right politician Javier Milei in the presidential primary election.

The state-owned bank, Banco Nacion, displayed an exchange rate of 365.50 pesos to one dollar, which is higher compared to the previous rate of 298.50 pesos on Friday.

The libertarian candidate Milei, an individual lacking political experience, who has suggested adopting the dollar as the currency for the country's struggling economy, exceeded predictions in the recent Sunday election, causing a massive upheaval in the political landscape, as described by local media.

Using an unconventional approach, the people of Argentina cast their votes to determine their preferred candidate from a pool of 22 hopefuls. This process enabled political parties to designate their top contender and also served as a crucial gauge of popularity leading up to the forthcoming October election.

Milei obtained 30 percent of the votes, surpassing the right-wing opposition contender Patricia Bullrich, who acquired 28 percent, and the candidate from the ruling center-left coalition, Economy Minister Sergio Massa, who secured the third position with 27 percent.

The immense nation of Latin America is currently experiencing a severe economic downturn, marked by a staggering annual inflation rate of 115 percent, and a distressing poverty rate of 40 percent.

The decrease in value of the commonly known official dollar rate is the highest within a 24-hour period since December 2015.

The unofficial market's "blue dollar" -- the easiest option for locals and companies due to stringent currency regulations -- was exchanging at approximately 680 pesos.

Argentina's national bank has additionally declared a substantial rise in its standard loaning rate - increasing from 97 percent to 118 percent - in its third significant surge in a span of five months.

The financial institution mentioned that the decision would serve to soften "forecasts concerning currency exchange rates and reduce the impact on prices."

Dollar-denominated bonds and Argentine stocks experienced a notable decline of approximately 10 percent on Wall Street.