Brazil will produce 1 billion Argentine peso banknotes.
The neighboring country will have to import the banknotes to reduce costs. The crisis in Argentina has led the country to turn to Brazil for money production. To reduce the costs of printing Argentine pesos, the Brazilian Mint is expected to produce approximately 20 million banknotes per week this year, including the new 2,000 peso…
The neighboring country will have to import the banknotes to reduce costs.
The crisis in Argentina has led the country to turn to Brazil for money production. To reduce the costs of printing Argentine pesos, the Brazilian Mint is expected to produce approximately 20 million banknotes per week this year, including the new 2,000 peso notes, resulting in 1 billion notes by the end of the year.
This movement has been taking place since 2020, with Brazil utilizing the idle capacity of the Brazilian Mint to manufacture the pesos. Last year, the country produced 600 million banknotes for Argentina.
“We try to find businesses that ensure the occupation of this capacity with the idle capacity we have,” explained Marcone Leal, superintendent of the banknote department at the Brazilian Mint.
And it’s not just Brazil. Argentina is also purchasing money from China and other European countries.
Crisis in Argentina
In 2017, the 1,000 peso banknote was worth approximately $55 (around R$270). After six years, its market value plummeted to less than $5 (R$25).
The devaluation of over 90% during this period has intensified as the local government incurs heavy public deficits, financed through the issuance of currency by the Central Bank of Argentina.
On May 22, the new 2,000 peso banknote (R$40) started circulating in the country. The banknote has the highest nominal value in circulation in Argentina. The Central Bank hopes that this measure will facilitate banking transactions and alleviate the burden on ATMs.
However, in a supermarket in Buenos Aires, the new banknote does little to improve the lives of Argentinians. With 2,000 pesos, it is only possible to buy half a kilogram of pasta. The amount is insufficient even to purchase a can of powdered milk, which currently costs nearly 3,000 pesos.
In March, the basic basket of goods in the country exceeded 60,000 pesos (a little over R$1,300), according to the National Institute of Statistics and Censuses of Argentina.
Source: https://revistaoeste.com/economia/brasil-vai-produzir-1-bilhao-de-notas-de-peso-argentino/