Overview
- In a new post following Milei’s midterm win, Domingo Cavallo urged scrapping the currency “cepo,” freeing capital flows, and giving the dollar de facto legal-tender status.
- He asked that Congress legislate these convertibility rules during the 2026 budget debate to provide legal certainty for monetary and financial transactions.
- Cavallo criticized use of the Foreign Exchange Stabilization Fund and future reserve purchases financed without sterilization, citing a presentation by BCRA vice president Vladimir Werning.
- He argued those interventions preserve de facto corporate exchange restrictions and undermine efforts to lower Argentina’s country risk.
- Cavallo pointed to supportive signals from President Donald Trump and investor Scott Bessent as helping reopen market access, and he predicted quicker disinflation with a 2026 economic rebound if his plan moves forward.