According to the Financial Times, this week, Brazil and Argentina are expected to announce inception of their joint project on the implementation of a nothing more than a single currency. Both presidents emphasized the need for a good relationship between Argentina and Brazil to strengthen regional integration, according to the article. Also, according to the publication, Argentina and Brazil, which are included in the Mercosur trade bloc, plan to invite other Latin American countries to join the emerging currency union. However, at this point these are all only rumors.

“(Latin America's two largest economies) will decide to start the considerations made to create a single currency that includes everything from tax issues to major economies and central banks,” Argentine Economy Minister Sergio Massa was quoted as saying to the FT.

There has been skepticism in past plans for mixed currencies between Argentina and Brazil. For example, when former Brazilian President Jair Bolsonaro first pitched the idea, economists felt that both countries needed to make sweeping economic reforms first.

According to CNBC, the idea of a common currency was discussed originally in an article written last year by Fernando Haddad and Gabriel Galipolo, now Brazil’s finance minister and his executive secretary, respectively, and was mentioned by President Lula during the campaign as something truly refreshing.

Lula chose Argentina for his inaugural international trip since taking office, keeping with the tradition of first visiting Brazil’s largest trading partner in the region. That follows four years of tense relations during the government of former Brazilian right-wing President Jair Bolsonaro. It’s too early to comment on the events – especially, as we know that Argentinian peso, unlike Brazilian Real – is a very inflationary currency. But the unified currency may theoretically become the one of the most respected instruments of Fx traders going forward.