Argentines eye black market for dollars: report

TEL AVIV (MarketWatch) � Argentines are increasingly turning to the black market to buy dollars in the wake of currency restrictions imposed by the administration of President Cristina Fernandez, the Associated Press reported on Saturday.

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Fernandez�s government has been trying to keep dollars in the country to bulk up the central bank�s reserves and pay government debt. It has restricted purchases of dollars from banks and exchange firms, AP reports.

But during the country�s economic crisis a decade ago, banks froze deposits and the currency devalued, AP reported. So Argentines are now buying dollars and either secreting them in the country or sending them abroad for safekeeping, the news service reports.

The official government exchange rate for the peso on Friday was 4.47 to the dollar while the black-market rate was above 5.5 pesos, AP reported.

Since she won reelection in October, AP reported, Fernandez has instituted controls on capital, caps on imports and the takeover of YPF, YPF �the country�s largest energy firm.

Emerging Latin America MarketWatch column on YPF.