The Argentinian central bank was forced to raise interest rates dramatically (up 17 percentage points since May 2013) as FX reserves evaporated, forcing a devaluation of the Argentinian Peso
in January 2014.
The ungluing became serious when the Argentinian peso
crashed over 15% against the dollar in one session.
Emerging markets are continuing to be hampered by the exodus of funds as investors move money back to the developed markets, something which has caused the likes of the Turkish lira, Argentinian peso
and the South African rand to be thrown into turmoil.
The Argentinian peso
has been in free fall since after a move by Argentina's government to devalue the currency last week.
Investors headed for the exit as concerns grew of a repeat of last June's emerging markets rout following Thursday's plunge in the value of the Argentinian peso
as the country's central bank gave up on its battle to prop up the currency through intervention in financial markets.
The South African rand, Russian ruble, Turkish lira, and especially the Argentinian peso
-- which fell 13 percent Thursday -- have been ''trounced,'' said Jane Foley, a currency strategist at Rabobank.
The rupee was the worst performer after the Indonesian rupiah and Argentinian peso
among 24 emerging-market currencies tracked by Bloomberg in the September quarter.
The devaluation of the Argentinian Peso
, however, forced companies to Face cost increases for imports, which in turn slowed down their renewal process.
US dollars are accepted everywhere and worth exactly the same as the Argentinian peso
He vowed to try to keep a key economic law pegging the Argentinian peso
to the United States dollar.