Thursday, May 30, 2024

ECONOMY | 25-04-2024 15:07

Argentina’s Central Bank lowers key rate to 60%

Policymakers at Argentina’s Central Bank lower interest rates to 60% from 70% as officials bet on a sustained slowdown of inflation.

Argentina’s Central Bank cut its key interest rate for the fourth time since President Javier Milei took office in December as officials bet on a sustained slowdown of inflation in the South American nation.

Policymakers lowered rates to 60 percent from 70 percent on Thursday, according to people with direct knowledge of the matter, who asked not to be named discussing private information. 

The cut, which was communicated to traders on the local Siopel system, comes hours after Milei said the nation would continue easing policy whenever inflation falls — part of a push by the libertarian president to clean up the central bank’s balance sheet.

A Central Bank spokesperson declined to comment. 

Argentina’s monthly inflation slowed more than expected in March, cooling for the third consecutive time as Milei’s austerity agenda hurts consumer spending. Consumer prices rose 11 percent from February to March, less than economists expectations for 12.1 percent. From a year ago, inflation accelerated to 287.9 percent, the highest level since the country exited hyperinflation in the early 1990s.

Milei’s economic team sees monthly inflation slowing much faster this year than analysts anticipate, forecasting consumer price increases will slow to 3.8 percent by September, according to a presentation seen by Bloomberg News that’s dated April 4 and authored by the office of Economic Policy Secretary Joaquín Cottani, a top deputy to Economy Minister Luis Caputo. Analysts surveyed by Argentina’s central bank in March saw monthly inflation at 6.2 percent by September. 

by Ignacio Olivera Doll, Bloomberg


More in (in spanish)