Argentina's current account surplus hits 8-month high on record exports

Argentina's foreign exchange current account showed a robust surplus of $1.877 billion in May, marking an eight-month high and a significant increase from April. This positive result was largely fueled by a record $4.322 billion in net goods exports. The economy also benefited from a 17% average decrease in private demand for dollars. Despite a 19% rise in the services account deficit, with outflows reaching $802 million, the overall surplus held strong. The income account also saw an increase in profit remittances, rising 30.4% to $476 million in May, as companies began sending profits abroad after years of restrictions. These figures, published by the Central Bank (BCRA), indicate a healthy economic performance. The BCRA itself was a major buyer in the currency market, acquiring $2.601 billion in May to boost its reserves. The National Treasury also purchased $150 million. Notably, these official purchases were closely matched by net foreign currency purchases of $2.667 billion by individuals, primarily for cash dollars and specific-purpose foreign currency transfers. Physical dollar purchases by individuals saw a slight decrease, with 1.4 million people buying $2.260 billion in cash dollars, while 730,000 people sold $408 million, resulting in a net demand of $1.804 billion. Approximately $700 million of these purchases were deposited in local banks, and $300 million increased external asset holdings. Another $800 million were used to settle credit card payments for services, as individuals preferred using their own dollars over pesos at the more expensive "card dollar" exchange rate.