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article imagePeso crisis is over, says Argentina's Macri

By AFP     May 17, 2018 in Business

Argentine President Mauricio Macri said a crisis that saw the country's currency plummet in recent weeks had ended, adding that reducing the budget deficit was a priority for his administration.

"We consider the turbulence overcome, but I believe it is important to recognize the nervousness experienced by the population. There was fear, there was anxiety," he told a press conference Wednesday.

A crisis of confidence in the Argentine peso saw it plunge nearly 20 percent over six weeks, and forced Argentina to seek a financial lifeline from the IMF. On Monday, it dipped to a historic low of 25.51 against the dollar.

"The central problem is the fiscal deficit," Macri added. "We have to reduce it. We cannot spend more than we have and depend on international loans to finance it."

The budget deficit has narrowed to the equivalent of 3.9 percent of GDP under Macri, a businessman who came to power in 2015.

Argentina's economy, Latin America's third largest, grew 2.8 percent in 2017 -- growth it hopes to continue this year.

However, the government has not managed to limit persistently high inflation, which has exceeded 20 percent for more than a decade -- a key aim of Macri's center-right government.

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