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7h ago

U.S. Treasury Steps Into Argentina’s FX Market With Peso Buys and $20 Billion Swap

U.S. buying targets acute illiquidity, reinforcing Argentina’s floating-band regime.

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Overview

  • U.S. Treasury Secretary Scott Bessent announced direct purchases of Argentine pesos and a $20 billion swap framework with the central bank after intensive talks in Washington with Economy Minister Luis Caputo.
  • El Cronista reports that Santander, Citi and JPMorgan executed some peso purchases on behalf of the U.S. Treasury, indicating operational support in the market.
  • Following the announcements, the official exchange rate slipped from about $1,470 to $1,420 per U.S. dollar as MEP and CCL rates fell roughly 5.7% and 5.8%, while equities rose up to 25% and sovereign bonds gained about 9%.
  • Central bank director Federico Furiase said the support bolsters defense of the exchange band and reflects stronger fundamentals, citing lower monetary aggregates, reserve accumulation, recapitalization after the IMF deal and reduced net debt.
  • Despite the short-term calm, a Focus Economics panel forecasts the peso near $1,496 per U.S. dollar by end-2025 and weaker in 2026, with some elements of the support package reported as not yet fully signed.