What the exchange rate gap is and how it is calculated

When people talk about the dollar in Argentina, sooner or later the word "brecha" (gap) comes up. It appears in the news, on social media and in everyday conversation, but it is rarely explained. In this guide we look at it simply, with a calculation you can do yourself.

What the exchange rate gap is

The exchange rate gap is the percentage difference between two quotes of the dollar. The usual comparison is the official dollar, which is the one used in the formal circuit and has access rules, against a free-market dollar such as the blue dollar, the MEP dollar or the CCL (contado con liquidación).

If the two quotes were similar, the gap would be small. If one is far above the other, the gap is large. That is why it is read like a thermometer: it does not tell you what the dollar is worth, but how far apart two ways of getting it are.

How it is calculated

There is a single formula: subtract the official quote from the free-market quote, divide by the official one and multiply by one hundred.

Gap (%) = (free-market dollar − official dollar) ÷ official dollar × 100

An example with made-up numbers, just to practice: if the official rate were $1,000 and the blue $1,200, the calculation is (1,200 − 1,000) ÷ 1,000 × 100 = 20%. That means the blue trades 20% above the official rate.

Two useful details: first, always use the same side of the quote for both prices (both selling, or both buying), otherwise the result is distorted. Second, the gap can be zero or even negative if the free-market dollar falls below the official one, which is uncommon but possible.

Why it widens and why it narrows

The gap grows when many people want dollars and there are few ways to buy them in the official circuit: demand moves to free markets and the price rises. Expectations about the economy, purchase restrictions and the amount of pesos in circulation also play a role.

The gap narrows when access to the official dollar widens, when restrictions ease or when confidence returns. To see how it has moved over time, check the dollar history.

What knowing it is useful for

To understand the news, to compare how much the dollar costs depending on the route used, and to get a sense of the market mood. It is not useful for guessing what will happen tomorrow: a high or low gap does not guarantee it will later rise or fall.

How to follow it every day

On Convertilo you have up-to-date quotes for the official dollar, the blue, the MEP and the CCL, so you can apply the formula whenever you like. You can also set an alert in the Telegram bot so it warns you when the blue reaches a value you choose.

Are the gap and the price difference the same thing?

Not exactly. The price difference is expressed in pesos (for example, $200 apart). The gap is expressed as a percentage, which lets you compare different periods even if prices have changed a lot.

Is there only one gap?

No. There is one for each comparison: blue against official, MEP against official, CCL against official, or even MEP against blue. When someone says "the gap", it is worth asking which dollar it is being calculated against.

Is a large gap bad?

It is a sign of tension between what can be obtained in the official circuit and what is paid outside it. For advice about your own situation, consult a professional or the official source.

This guide is for information only and is not investment advice. Market quotes and rules change: always verify the information with the official source.