Buenos Aires Times

economy DOMINGO CAVALLO

Central Bank denies Cavallo-Sturzenegger meeting

Domingo Cavallo was Economy minister under presidents Carlos Menem and Fernando de la Rúa. He is largely blamed for the country's 2000/2001 'corralito' financial crisis. 

Today 10:00 AM
Argentina's former Economy minister Domingo Cavallo.
Argentina's former Economy minister Domingo Cavallo. Foto:NA / Daniel Vides

More Economy News

Former Economy minister Domingo Cavallo visited the Central Bank headquarters on Thursday evening, sparking controversy.

In the context of ongoing political and economic nervourness, the entity was forced to deny rumours that the economist had met with Central Bank governor Federico Sturzenegger.

Cavallo was Economy minister under presidents Carlos Menem and Fernando de la Rúa. He is largely blamed for the country's 2000/2001 corralito financial crisis. 

The Bank confirmed that the former public official had instead attended a meeting about the upcoming G30 summit, which in May will bring together bankers, former central bank governors and former economy ministers of the world’s richest countries. Cavallo is the only Argentine in the select group, presided over by former US Federal Reserve chief Paul Volcker. Sturzenegger will be the event’s host.

TENSE RETURN

The economist made a tense return to the public spotlight around two weeks ago, and just days before the peso plummeted, offering some arguably unwanted advice to the government.

“It is an enormous danger for the Central Bank to continue emitting debt”, he added. “Just as capital comes in, it can also flow outward. The Central Bank must pay: either by raising its (interest) rates or printing (cash)”, he said.

“A (situation similar to the crisis in) 2001 could happen in a few years if they continue with this exaggerated debt financing policy and they do not reduce the fiscal deficit”, he added.

The government sent Commerce Secretary Miguel Braun on a media blitz to downplay Cavallo’s comments and urge calm.

Central Bank chief Sturzenegger is considered a disciple of Cavallo’s. The pair meet regularly. “I hold Sturzenegger in high regard but I do not advise him. Actually, I usually criticise him,” Cavallo said after an image of him entering the Central Bank went viral in late 2017.

-TIMES

Poll

Op-Ed

Top Stories

  1. 1Lincoln: international schooling in ArgentinaLincoln: international schooling in Argentina
  2. 2In Argentina, the media is a weapon
  3. 3Editorial: A long overdue debate – and a necessary one
  4. 4Lincoln: international schooling in Argentina
  5. 5Dollar jumps past 23-peso mark after dip in early trading
  6. 6Government prepares to host first high-profile G20 meeting
  7. 7Development in City prompts debate over gentrification, cultural heritage
  8. 8A history of political violence and the issue of the Mapuches
  9. 9‘We’re far away from 2001’, says Argentina's Commerce Secretary
  10. 10Mexico continues to bear the scars of drug violence and corruption