Citigroup Inc sold Argentine pesos to the Federal Reserve on Thursday as part of US Treasury Secretary Scott Bessent’s extensive initiative to support the currency and the administration of Javier Milei, according to sources. The Federal Reserve functioned as a fiscal intermediary for the Treasury, according to the sources. Bessent’s Treasury is acquiring the troubled … Read more
Economy Minister Luis Caputo stated that dollarization in Argentina is “off the table” after the announcement that the United States would provide the country with a currency swap line and directly intervene in the local forex market by purchasing pesos. “Dollarization could be an alternative, but for now it is off the table,” Caputo stated … Read more
Having depleted billions of dollars in reserves, Argentina’s government is employing innovative strategies to safeguard the peso in anticipation of significant midterm elections later this month. The Central Bank expended US$1.1 billion in the spot market last month as the currency exceeded its trading band and is now approaching a limit set by Argentina’s primary … Read more
Investors in Argentina are raising their expectations that President Javier Milei will implement a devaluation of the peso following the midterm elections this month, as the government continues to exhaust its reserves to support the struggling currency. The Treasury took action for the seventh consecutive session on Wednesday. It had already sold an estimated US$1.5 … Read more
To understand the currency crisis destabilizing the Argentine economy and threatening the administration of President Javier Milei, one need only cross the Andes mountains to reach the Chilean capital of Santiago. Outside a Courtyard by Marriott hotel, Carolyn Pérez recently observed scenes that reflect broader economic trends. Pérez recounts the experience of two Argentine couples … Read more
Risks don’t disappear just because you ignore them. They only become more dangerous. – Nassim Nicholas Taleb At its core, economic policy represents the strategic management of risk. Every programme faces inherent tensions, and each stabilisation plan necessitates a set of decisions that favor specific objectives while sacrificing others. Every government determines the risks it … Read more
President Javier Milei is intensifying his defense of Argentina’s currency in anticipation of another substantial local debt auction, exacerbating the strain on the banking system and the wider economy as he combats inflation. The government is conducting an auction on Wednesday for peso notes and dollar-linked securities, marking the second such event in a fortnight. … Read more
Argentine authorities audit investor behavior in repo loans, short-term financial securities with record-high interest rates due to bank liquidity shortages. The Central Bank and local regulator CNV have sought assistance in analyzing the real-time data they receive daily from the country’s two primary exchanges, BYMA and A3, regarding the short-term instruments referred to locally as … Read more
In response to the bribery allegations involving a close associate, President Javier Milei’s senior officials are taking measures to mitigate the repercussions, which are impacting Argentina’s dollar bonds. This situation is exacerbated by a liquidity crisis that has led to a significant increase in interest rates. Argentina’s dollar bonds are being weighed down by bribery … Read more
A “dollarized” Argentina is doing well and a “pesofied” Argentina is struggling. Once the enthusiasm about inflation reduction subsides, Argentines will measure the Javier Milei administration depending on where in the social food chain they land. This will be measured by a simple variable: their standards of living vis-à-vis the past and their fellow countrymen. While it … Read more