Argentina-Russia tremors in emerging markets

After the devaluation of the Argentine and Russian currencies against the dollar, all eyes turned to emerging markets. The sharp devaluation of the Argentine and Russian currencies against the dollar has once again turned eyes to emerging markets. Following the primary election victory of radical right-wing politician Javier Milei, who promises to dollarize the economy, against the centrist parties on Sunday, Argentine President Alberto Fernandez announced that the peso has been devalued by 18 percent against the dollar. Thus, one dollar has risen to 350 pesos. The Argentine Central Bank raised the policy rate from 97 percent to 118 percent. The country's inflation rate is at 115 percent and looks set to worsen with the latest devaluation. Many businesses in the country, from electronics retailers to restaurants, have witnessed their suppliers increase prices by 20 percent overnight. Russia has also pressed the panic button as the devaluation of its currency, the ruble, has accelerated due to the increasing costs of the war and the rapid decline in its exports. The Russian Central Bank will meet urgently on Tuesday to announce its interest rate decision. The dollar/ruble exchange rate had exceeded 100 on Monday. Shortly before this development, Kremlin economic advisor Maxim Oreshkin blamed the central bank for the ruble's depreciation. The Russian Central Bank raised interest rates by 100 basis points to 8.5 percent last month.