The sharp fall in Argentina's exchange rate has caused trouble to many investors and has had a great impact on the lives of Argentinians.

Because Argentina's economic structure is too single and too dependent on the US dollar, Argentina's exchange rate has plummeted under some economic pressure.

First of all, the main external factor behind the collapse of Argentina's exchange rate is the Fed's need to raise interest rates.

The Federal Reserve announced last month it would raise interest rates for the second time this year and predicted it would raise interest rates four times this year, up from the three previously expected.

Secondly, Argentinian citizens express distrust in their own currency, which is an important reason for relying too much on the U.S. currency.

Thirdly, currency depreciation and inflation have formed a vicious cycle.

According to official data, Argentina's inflation rate last year was 24.8%.

Fourth, Argentina’s economic structure is too single, which leads to problems in import and export.

Argentina's main source of foreign exchange earnings is agricultural exports.

Argentina's soybean production has been severely reduced due to drought and heavy rains, which has caused Argentina's dollar income to plummet.

Fifth, the government is too chaotic in adjusting the status quo.

Argentina has made a lot of efforts to activate its economy and attract foreign investment, but too much foreign capital inflow has led to chaos.

Argentina has experienced many debt crises, which have caused the country's exchange rate to drop to a large extent. However, what is gratifying is that despite this, the economy is still growing and the unemployment rate has dropped.

At the same time, debt as a share of gross domestic product remains lower than during the 2001 financial crisis.

Moreover, the current risk resistance of Argentina's financial system has also been significantly enhanced.