I just came across a news story that American Airlines will no longer accept Argentinian pesos as payment for tickets. It seems that American Arlines can’t find anybody willing to take them.
I’ve heard that Brazil is in recession. It’s no secret that Venezuela’s economy has pretty much ground to a halt thanks to its wannabe Communist leaders. But I don’t recall hearing anything about Argentina recently. What’s going on?
Growth is around 0 and inflation is high at 25%. Couple that with currency controls which will likely come down now with the election of a right wing president and the Argentinian peso likely will face devaluation. Maybe AA is just trying to minimize currency losses.
Their currency situation has been tough for a while. I planned an event out there several years ago, and between inflation and currency controls it was enormously difficult.
The Argentine Peso trades at 15 per one dollar on the black market, while the Argentine government has artificially kept it down to 9.67; for American Airlines to legally trade back its pesos to Argentina for dollars, it would be getting ripped off.
And if it trades Pesos at market value somehow, the airline risks getting banned…
So the decision is, no Pesos, problem solved.