Emerging markets continue to crumble, and the spillover on major economies is obvious. Problems always start somewhere, usually at the periphery.
Via translation from Lanacion, please consider Credit Is More Expensive.
Following the peso devaluation and sharp hike in interest rates by the central bank, interest rates on loans increased as much as 11 percentage points.
For a personal loan, private banks now charging at least 44% per year. Factoring in fees and other administrative expenses (up to 11 percentage points), the total financial cost exceeds 65% annually.
Public banks have with nominal rates for personal loans in pesos that range from 32% to 44%, with a total financial cost up to 55% annually.
Banks also shortened their terms and revised installments on credit cards
Is 65% a Good Rate?
If Argentina is in the midst of full-blown hyperinflation, then any loan rate is a good rate, because the peso will soon become worthless.
If banks believe that is likely, they may publish rates, but credit will completely dry up.
Mike “Mish” Shedlock