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Argentina currency collapse claims 2 ministers and central bank governor

Wednesday, June 20, 2018

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BUENOS AIRES, Argentina (AFP) – Argentina's President Mauricio Macri has replaced two cabinet ministers responsible for economic issues in the continued fallout from the collapse of the currency, State media said on Saturday.

The removal of Energy Minister Juan Jose Aranguren and Production Minister Francisco Cabrera, reported by the official Telam news agency, came two days after Central Bank Governor Federico Sturzenegger lost his job to Finance Minister Luis Caputo.

Dante Sica, an economist, takes over from Cabrera, while Javier Iguacel, an engineer, assumes the post which Aranguren held since 2015.

Macri in March was forced to defend Aranguren, former president of Anglo-Dutch oil company Shell in Argentina, after the minister admitted keeping his fortune of US$88 million abroad because he lacked faith in the domestic economy.

Following a currency crisis in April and May, the International Monetary Fund announced a US$50-billion standby loan in early June after Latin America's third- largest economy sought help to bolster market confidence.

Pressure on the currency continued Thursday when the peso plunged more than six per cent against the US dollar, leaving it at a record low before a slight recovery on Friday.

Since the start of the year the peso has dropped more than 30 per cent against the dollar.

To compound its problems, Argentina is also confronting annual inflation of more than 20 per cent and a trade deficit.

The Buenos Aires stock exchange plummeted more than 8.0 percent Monday, pulled down by sharp declines in energy and bank shares amid market volatility as Argentina seeks support from the IMF.

The Merval Index dropped 8.33 percent to 27,636 points, after President Mauricio Macri fired Energy Minister Juan Jose Aranguren and Production Minister Francisco Cabrera in a surprise move over the weekend.

Argentina is expecting to receive today the first $15 billion tranche of the $50 billion standby loan announced by the IMF in return for a commitment to reforms of an economy weakened by a chronic budget deficit and more than 20 percent annual inflation.

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