US EditionUruguay’s Peso the Most “Overvalued” Currency as It Tops Big Mac Index Ranking
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2 Articles
Uruguay’s peso the most “overvalued” currency as it tops Big Mac index ranking
Uruguay’s peso has been labelled the world’s most “overvalued” currency against the U.S. dollar on a GDP-per-capita-adjusted basis, according to the latest Big Mac Index published by The Economist and cited by Uruguayan media. Under the adjusted methodology, the peso is estimated to be 83.9% above its implied “long-run equilibrium.” In the unadjusted ranking, Uruguay places second, with 43.1% overvaluation, behind the Swiss franc.
Ten days ago, the exchange rate of the dollar in Uruguay pierced minimum values in the last five years and revived a debate that, in fact, was overflying within the productive sector: the appreciation of the Uruguayan peso puts competitiveness at risk, reduces profit margins and damages investment. In fact, with a loss of more than 3 percentage points, that currency is the one that was most appreciated during the last time around the world, abov…
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