# Dollar Scarcity Returns to South America

Economies with thin reserves and managed exchange rates will keep facing recurring pressure as a strong dollar, oil costs and neighbors' devaluations drain foreign currency. Governments will repeatedly choose between recession, devaluation and controls.

- Conviction: 40 / 100 (forming)
- Horizon: Emerging (watchlist)
- Tracking since: 2026-11-01T00:00:00.000Z
- Last updated: 2026-11-01T06:22:40.478Z
- Canonical: https://polylog.news/trends/latam-dollar-scarcity
- Publisher: Polylog
- Affected regions: Latin America

## Recent evidence

- [confirms] Argentina's country risk rises about 30% in October as the central bank acknowledges a recession (2026-11-01): Argentina's country-risk spread rose about 30% in October to around 787bp, and the central bank acknowledged a recession. Caputo is delaying consumer relief until March and adding utility subsidies, while Cavallo calls for $15 billion in reserve purchases. This is the recession-versus-reserves trade-off the thesis predicts, made sharper by Brazil's 9% devaluation next door.