Dollar: how much will it be at the end of 2026 according to the latest new market projections

The Argentine economy is undergoing a transformation that could redefine its financial landscape, with private-sector credit showing signs of recovery after years of stagnation. For decades, Argentinians have lived under an economic anomaly, an almost nonexistent credit system. Buying a home or financing an investment became a privilege reserved for those with existing capital or access to subsidized loans imposed by the government. The average citizen was left with a simple rule: save first, buy later. In an inflationary environment where the peso consistently lost value, this “later” often never came. The system punished savers instead of rewarding them. For long periods, interest rates paid by banks remained far below inflation levels. The rational response was to withdraw savings, seek refuge in dollars or property, or consume before money lost its value. On the other side, a harmful distortion developed: a culture of debt based on the expectation of debt liquidation. Borrowing could be profitable if one secured a subsidized or artificially low rate, and then inflation reduced the real value of payments. Instead of building a culture of saving and lending, Argentina built one of escaping the peso and another of seeking debt liquidation. A healthy credit system requires exactly the opposite: that saving be reasonable, that depositors receive adequate returns, that borrowers understand they will repay, and that banks profit from correctly intermediating between both parties. This seems elementary, yet in Argentina, for too long, it was not. That is why one of the most significant changes Argentina’s economy is experiencing deserves more praise than it receives: private-sector credit is returning. In July, bank credit in pesos reached 9.2% of GDP, and including foreign currency loans, it climbed to 12.5%. However, Argentina still lags behind. According to the World Bank's broad and consistent definition, in 2024, private-sector credit measured against GDP amounted to 40% in Peru, 76% in Brazil, and 104% in Chile. In the United States, it surpassed 200%. In the housing loan sector, the gap is even more dramatic. The stock of these credits barely exceeds 1% of Argentina’s GDP, compared to around 27% in Chile and 50% in the United States. A neighboring country has thus a mortgage market, relative to its economy, over twenty times larger than ours. How did we arrive at this point? The answer lies primarily in the chronic fiscal deficit. For many years, especially under the Kirchner model, the State functioned as a massive vacuum for available resources. The deficit had to be financed through monetary emission, Treasury debt, or indirectly via the Central Bank and the financial system. For banks, lending to the State at high rates with minimal capital consumption was often more attractive than assuming the risk of funding a small business, a family, or a long-term investment. A phenomenon known as "crowding out" emerged: the public sector displaced the private sector from the credit market. Argentines' limited savings ended up financing the State instead of homes, machines, shops, and businesses. The balance of public accounts initiated during President Javier Milei’s administration fundamentally changes this equation. An State that does not systematically spend more than it collects no longer competes for each available peso. Savings grow and can once again turn toward the private sector. Simply put: banks can return to being banks. Probably, the most visible manifestation of this process will be in the mortgage credit sector. During 2017 and early 2018, in the government’s The market expects the official dollar to close 2026 around $1,630, according to the latest Market Expectations Survey (REM) published by the Central Bank. The data comes from a survey conducted between August 27 and 31 among 47 participants, including 35 local and international research firms and 12 financial institutions. The Central Bank clarifies that these figures represent private estimates and do not constitute projections from the monetary authority. The median of responses placed the nominal exchange rate at $1,630 per dollar for December 2026. If realized, this would imply an annual increase of 12.6% compared to December 2025. Among the analysts in the so-called Top 10, those with the highest accuracy in previous forecasts, the projection is slightly lower: they expect an average dollar of $1,626 in December. The REM does not include the blue dollar or financial exchange rates, but rather the monthly average official exchange rate, referencing the daily quote published by the Central Bank under Communication “A” 3500. The expected path until year-end shows a gradual rise in the dollar. According to the exchange expectations chart in the report, the median is set as follows: September: $1,530 October: $1,565 November: $1,600 December: $1,630 January 2027: $1,661 February 2027: $1,695 The graph of exchange expectations included in the report shows an upward trend, though without sharp jumps in central market projections. For September, the estimate dropped compared to the previous REM. The market projected an average dollar of $1,530, approximately $15.80 less than in the previous survey. Expectations for 2027 extend beyond December. The REM projects that the average official dollar will reach $1,844, while by December 2027, the median is expected to be $2,016. Thus, private expectations anticipate continued nominal depreciation of the peso throughout 2027, although the survey shows wide dispersion among participant responses, especially as the projection horizon extends. The yen surges strongly: Could it become an option for Argentine investors? The exchange rate expectation appears within a scenario where analysts estimate an inflation rate of 1.7% for August and project a gradual slowdown in prices in the coming months. Thus, for now, the market consensus places the reference exchange rate at a specific number: $1,630 per official dollar in December 2026. The level of bank reserves is appearing as one of the key factors behind the high cost of financing. Santiago Llull explained that “banks are conditioned to have a certain amount of reserve money that hasn’t been seen in any government,” a situation directly impacting the interest rates. In the Ronda de Economistas (RDEco) by +Perfil, the new channel of Editorial Perfil, Santiago Llull, Ramiro Tosi, and Pilar Welfeelt analyzed the impact of reserves on the cost of credit and the Central Bank’s intervention. The discussion also covered the bank spread, liquidity, and the official objective of containing the exchange rate. How reserves affect the cost of credit Ramiro Tosi detailed how the so-called bank spread works, i.e., the difference between the rate received by savers and the rate paid by borrowers. “This is what we technically call the spread, which is the difference between what I get as a depositor and what you pay as a borrower,” he explained. This is not liked by authoritarians The exercise of professional and critical journalism is a fundamental pillar of democracy. That is why it annoys those who believe they are the owners of the truth. According to Ramiro Tosi, the reserve is the first component of that difference: “The Central Bank forces the bank to keep part of that deposit in a Central Bank account without any kind of remuneration.” The specialist argued that, with a remunerated deposit at 20%, the funds available for lending must generate a higher yield to compensate for the immobilized money. “With a 20% rate, it has to start lending at 36,” he said, before adding operational, regulatory, and tax costs that could quickly push the rate to 60%. Ramiro Tosi also questioned the current level of reserves: “You’re at a reserve level that is higher than the worst moment in Argentine history,” referring to the period of 2000–2001. The dollar as a priority and the Central Bank’s intervention The policy of interest rates is also shaped by the goal of controlling the exchange rate. Pilar Welfeelt explained that the Central Bank and the Treasury carried out a swap of instruments to make available Dollar-Linked bonds and use them in the foreign exchange market. “Mainly, the objective is to control the foreign exchange market because the government has decided that the exchange rate should be around 1,500 and doesn’t want it to exceed that level,” she stated. The journalist added that the government seeks to control liquidity due to its impact on both the dollar and inflation. “It’s not just the availability of pesos, but also the speed at which those pesos move,” she explained. In this scenario, Pilar Welfeelt highlighted that reserves remain a relevant tool: “They also have stricter reserves than other countries that are gradually releasing them.”