The Bimonnear economies They are those where two different monetary patterns coexist, that is, there is co-circulation of coins; In Argentina, the Argentine peso and the American dollar. Why? They both fulfill the functions of money: means of change, account and reserve unit. When the economy is of this type, the functions are performed in two different currencies, which exists:
This characteristic makes international reserves requirements must be more rigid, in order to meet the two demands: the demand that monetary authority makes to avoid paying crises and the demand of private agents, for the most part, to preserve the value of their assets (financial bimonetarity).
Its evolution is shown below in a graph and gives an idea of the volatility that is recorded in that variable.
Graphic: Argentina. Variation of International Reservations for Transactions. Annual data expressed in equivalent to millions of US dollars.
In this scenario, If reservations fall into considerable value, capital control (stock) is implementedas Argentina did in 2011, which was interrupted at the end of 2015 and was implemented again in 2018 until April 11, 2025.
What international and national scenario does Argentina find? Starting with the international level, the new tariffs presented by the United States on April 2 leads to the rest of the countries also uploading their tariffs as a defense, but these increases are accompanied by devaluations in their exchange rates (to compensate for losses). The result is that products begin to be sold in other countries at very low prices (touching what is known as dumping).
The national scenario prior to the rise of tariffs, according to INDEC data presented in April 2025, shows that the Industrial Production Index (IPI) manufactured rose 5.6% in February compared to the same month of 2024. In addition, the accumulated of 2025 registered an increase of 6.6% compared to the same period of the previous year. In addition, Inflation step from 2.4 in February to 3.7 in March.
What to expect then?
According to the degree of commercial opening that decides to carry out the government, the real economy could recover more or less fast. If the commercial opening is high, the industry would have a difficult path of adaptation, as it could not compete with imported products and would be forced to reduce personnel and it would be convenient to become importers.
If the commercial opening is rather moderate at low, a recovery of the domestic market could be achieved. But, to this we must add the change of the exchange regime. The lifting of the stocks (partial) showed the audacity to eliminate fear of floating (“Fear of floating”) by the government. The dollar will range in a band between 1000 and 1400 pesos.
What could happen is that the economic agents go out to buy currencies and that reduces international reserves, but since there are no excess pesos to make said purchase by the private sector (unless some buyer appears with a lot of money that raises the price of the American currency), we would not have to worry about the value of the exchange rate. This measure, together with the reduction of the fiscal deficit since December 2023, managed to support the IMF -which allowed a new disbursement by the body -as well as the contribution of other credit agencies.
To this would be added the eventual currency liquidation by exporterswhich would tend to increase the levels of gross international reserves of the monetary authority. In this way, a positive signal would be sent to the market regarding the sustainability of the payment of debt with private creditors. So can it be different this time?
Professor of the Department of Economy and Finance and Researcher of the Institute of Economy (INECO) of UADE.
Source: Ambito
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