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The country’s Central Bank will suspend the issuance of pesos; the measures are aimed at lowering the exchange rate
The Argentine government has announced that it will withdraw US$2.5 billion from circulation and suspend the issuance of pesos starting this Monday (July 15, 2024). The measure is an attempt by the Ministry of Finance and the Central Bank to control the country’s inflation.
In June, the rate was 271.5% in the 12-month period. The monthly rate was 4.6%, the first increase after 5 months.
With this, the monetary authority can sell up to US$2 billion on the parallel market to reduce the difference between the official exchange rate and the dollar rate. blue.
According to the Argentine newspaper The nationthe dollar parallel It has been quoted at around 1,350 Argentine pesos in recent days and reached a record high of 1,500 pesos on Friday (12 July). The official exchange rate was 940.55 at 3:42 pm this Monday (15 July).
The announcement was made by Economy Minister Luis Caputo and will be implemented by the monetary authority headed by Santiago Bausili. The government and the Central Bank did not provide details on how the operation would work, such as how long it would take to remove the US$2.5 billion from circulation or how many dollars would be sold per day.
The measures are expected to impact the Central Bank’s ability to accumulate foreign reserves and could make it difficult to pay the US$44 billion (around R$240 billion) debt to the IMF (International Monetary Fund).
Presidential spokesman Manuel Adorni celebrated Luis Caputo’s decision and stated that the economic team “considers [a medida] necessary to finish eliminating inflation, which has its death certificate signed, all that is left is to add the date”.
Source: https://www.poder360.com.br/internacional/argentina-anuncia-venda-de-dolares-no-mercado-paralelo/