Buenos Aires Times

economy PESO CONTINUES DIVE

Gov’t unleashes 3-point plan to rein in dollar

The dollar was selling for a record 30.68 pesos on Monday.

Tuesday 14 August, 2018
Macri, Caputo and Dujovne. An strict board for ruling the economy.
Macri, Caputo and Dujovne. An strict board for ruling the economy. Foto:Cedoc.

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The Mauricio Macri government is concerned about the exchange rate, with Argentina’s peso continuing its slide against the dollar.

On Monday, the dollar was selling for a record 30.68 pesos.

Macri’s economic team, led by Treasurer Nicolás Dujovne and Central Bank Governor Luis Caputo, plans to unleash a series of initiatives aimed at easing the effect of Turkey’s economic woes on the Argentine economy.

The government will focus on three points: Raising interest rates; the “gradual elimination” of the Lebac as a key tool, with the hope of boosting confidence and easing the volatility of the short-term peso-denominated bonds whose stock exceeds one billion pesos; and the suspension of daily sell-offs of Central Bank reserves stemming from the stand-by loan deal with the International Monetary Fund (IMF), which will be replaced from today (Tuesday) with a sole offer of US$ 500 million.

On Monday, the Central Bank raised interest rates 500 basic points to 45 percent annually, on the back of fears surrounding inflation. The Bank says it will look again at interest rates in October.

-TIMES

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