The unstoppable rise of Argentina's blue dollar

Argentine peso

I returned to Chile this week as the Argentine peso reached parity with the local currency.

Since I first took guests across to San Pedro de Atacama 12 years ago, Chile has recorded 66.7% inflation: Argentina has recorded almost twice that rate in just the last 12 months.

Argentina’s blue dollar rate (the real measure of its value, not the official rate of 357 pesos) has topped 900, while the Chilean peso is 937 against the US$ on the official rate.

Our lucky neighbours don’t have a parallel economy with a multitude of dollar values, including the Crypto Dollar, the Coldplay dollar, and the Qatar dollar (named as such because it was applied during last year’s World Cup to sting Argentines using their bank cards abroad, charging them double the official rate).  

A friend’s mother has spent 18 months trying to claim her husband’s pension after he died: Argentine bureaucracy never runs particularly smoothly.

Paid out in pesos, she bought dollars at 900: when she should have cashed in her pension, the blue dollar was between 200 and 270, so she’s lost around three quarters of its value.

When I went into Salta city centre last week to buy last minute supplies for our trip to Chile, people were queueing around the block to withdraw money from the bank.

It’s logical: in Argentina’s upside down world, when there’s no confidence in the peso, the only way of protecting your earnings is to buy US dollars: thus fuelling inflation and driving the parallel economy, as demand for the greenbacks rockets.

When I started doing trips 15 years ago, I was spending an average of 50 or 60 pesos per day on expenses of food and accommodation.

Admittedly, I sometimes treat myself to the slightly less budget options now, but I’m spending more like 15,000 to 20,000 pesos daily. 

So why has the blue dollar gone through the roof recently?

I am not an economist, and I stand to be corrected by those who are more able than me, but it appears mostly because we have an election on the horizon.

Before the primaries in August, when the third party candidate narrowly topped the poll, the blue dollar was hovering around 500. After the results, it shot up to 650.

Javier Milei, now the front-runner in the real elections on Sunday (22nd October), is a wild-haired liberatarian with some wacky ideas who claims to be from outside the “political caste”… hmm, does that remind you of anybody?

The other main opposition candidate, narrowly second in the primaries, is Patricia Bullrich, a former member of the youth wing of the Montoneros, an armed Peronist group from the 1970s, who travelled across the political spectrum to become a leading light as Minister of Security in the economically liberal Macri government of 2015 to 2019.

The “official” candidate is Sergio Massa, the current Minister of the Economy who has presided over more than 100% inflation but promises he will do an excellent job if left to run the country by himself.

Not surprisingly, many of the local voters aren’t particularly impressed, and are taking refuge in the US$.

After two televised Presidential debates, the dollar topped 900, crazily teetering on the verge of four figures for a few hours.

Argentina’s lame duck President Alberto Fernandez, so unpopular even within his own party that he isn’t running for a second term, has of course blamed this on Milei!

As Argentines go to the polls this weekend, whatever happens after the election (and even Milei has backtracked on his promises to eliminate the peso), cynics joke that at least if the peso peaks at 1,000 it will be easier to work out the exchange rate for dollarization.

What this means, of course, is that if you’re planning a trip to Argentina, and want to do a private tour with one of our English-speaking guides, your holiday is great value.

As we tell all our guests on our tailor-made trips, you need to bring US$ cash to get the real street value of things: rest assured that you’re not exploiting the locals, you’re bringing in much needed US dollar bills.

Sergio Massa had at least one good idea: applying a special tourist rate to visitors using their foreign bank card: see my blog on the Dollar MEP for more info.

This brings money into the official economy, and also gives you a decent rate close to the blue.

We await the results of this week’s elections to see what the economic future holds: of one thing, at least, we can be sure: the future of tourism in Argentina is bright.

 

 

 

 

 

Duration
2 days
Group Size
1 to 4

Essential Humahuaca

Combine the highlights of the colourful Quebrada de Humahuaca with the other-wordly Salinas Grandes salt flats in the Argentina Altiplano.

Rich in indigenous culture and colonial history, the old trade route from Buenos Aires to Lima features the Seven Coloured Hill of Purmamarca, and Hornocal's lesser known sierra of Fourteen Colours.

A side-trip to appreciate the immensity of the Salinas Grandes salt flats makes this one of the most diverse two day trips available from Salta or San Salvador de Jujuy.

Click here to view map route.

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$250
Duration
6 days
Group Size
1 to 3

Footsteps of the Conquistadores

A high altitude 4x4 adventure along the old colonial mining route: this Altiplano tour brings you into close contact with the mountain plateau wildlife of vicuña, flamingoes, and rhea.

This excursion combines the must-see highlights of the UNESCO-protected Quebrada de Humahuaca with little-explored sections of the Argentine mountain plateau.

Far from artificial light, enjoy the breathtaking night sky in remote hamlets places like Yavi and Santa Catalina, close to the border with Bolivia.

Click here to view map route.

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$900
Duration
4 days
Group Size
1 to 4

Fourteen Colours & Cloud Forest

Hike Argentina’s Inca trail, linking two completely different eco-systems, the dry canyon of Humahuaca and the Cloud Forest of Calilegua.

We take a narrow mountain road which was only finally completed in October 2019, tracing the footsteps of Inca explorers of northwest Argentina from the 15th century.

This trip can be extended to include a visit to the gorgeous mountain town of Iruya and the historic settlement of Yavi on the Bolivian frontier.

Available April to November.

Click here to view map route.

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$500
Duration
6 days
Group Size
Up to 4

Mountains to Cloud Forest trekking

This is one of our most challenging north west Argentina hiking trips, recommended only for experienced trekkers: covering 58km over four days, we climb to an altitude of 4,200m, gradually descending to 1,325m, following the contours of mountain tracks along the way.

This hike offers a complete change in eco-system during four days: starting in the mountains which enfold the Quebrada de Humahuaca, we descend into the Yungas Cloud Forest of the east, following the trail of indigenous traders who travelled between the salt flats and the sub-tropical jungle.

There is an extraordinary range of landscape in these four days, and a warm welcome for modern hikers from the families in the refuges where we sleep overnight.

Available April to November.