Luis Caputo resigned the presidency of the Central Bank on Tuesday morning, barely three months after taking the post.
Economic Policy Secretary Guido Sandleris will replace him at the head of the institution, the government confirmed. He has worked previously for the World Bank and Inter-American Development Bank.
The shock resignation, which the bank said was for "personal reasons," comes with President Mauricio Macri's administration negotiating additional funding from the International Monetary Fund (IMF), three months after securing a US$50-billion loan from the international lender to stabilise the economy.
“This resignation is due to personal issues, with the conviction that the new deal with the International Monetary Fund will re-establish confidence in the fiscal, financial, monetary and exchange regimes,” the statement said.
Caputo, 53, was a close ally of President Macri, having served previously as finance minister. Like many of Macri's economic team, he arrived in public service with experience from the private sector, having worked as a trader for both Citigroup and Deutsche Bank.
Bad timing
Macri is currently in New York, attending the United Nations General Assembly, while back home discontent is growing as a 24-hour general strike paralyzes the country.
The Central Bank said in a statement announcing Caputo's resignation that he was doing so with the conviction that a "new agreement with the International Monetary Fund will restore confidence," but analysts said there were already rumours he would resign due to "a disagreement with the IMF over monetary policy," according to Argentine economist Gabriel Rubinstein.
Another economist, Fausto Spotorno said Caputo was never seen as a long-term fixture and that "the government's priority is an agreement with the IMF."
After a crisis of confidence beginning in April saw the value of the peso plunge, Argentina negotiated a US$50-billion bailout loan from the IMF that included an initial US$15-billion tranche in June.
But that failed to prop up the currency and Macri announced in August he would be seeking an accelerated disbursement of the remainder of the funds that were initially due to be transferred over a three-year period.
That sparked two days of damaging drops in the value of the peso, which lost 20 percent against the dollar. For the year it is down around 50 percent.
Macri responded by announcing new, and unpopular, austerity measures including halving the number of government ministries and restoring taxes on grain exports.
The Central Bank hiked interest rates to a world-high 60 percent and the peso has remained largely stable since its sudden crash in August.
But restoring faith in the peso has proved difficult with sceptical Argentines believed to be holding US$300 billion outside of the country's fiscal circuit, either in cash or abroad, in a bid to protect their assets from the peso's woes.
- TIMES/AFP
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