Hurried by the reserve crisisthe Government gave in to the demands of the FMI and “the markets” to accelerate the rate of exchange depreciation. He Central Bank (BCRA) announced this Monday afternoon that the exchange bands (the floor and ceiling of the official dollar rate) will be updated based on the inflation of the previous two months. This leaves behind the 1% annual guideline that functioned as an “anchor” against an inflation that has more than doubled in recent months (2.5% in November).
In a statement, the BCRA announced that “As of January 1, 2026, the ceiling and floor of the exchange float band will evolve each month at the rate corresponding to the latest monthly inflation data reported by INDEC (T-2).” In this way, on January 1 the band will adjust 2.5%, based on the November CPI.
He president of the Central Bank, Santiago Bausiligave a press conference in which he stated that “the band system is the best exchange rate regime,” and that the entity will begin to intervene within the band with a volume they estimate to be 5% of operations. The objective would be for the “peso not to appreciate” (a drop in the dollar) given the increase in demand for money (pesos) that is theoretically expected in the coming days. But in reality there is a Government’s desperate need to accumulate dollars to face future maturities, and if the BCRA begins to buy currencies, its price will necessarily rise.
The decision to make the bands more flexible was immediately celebrated by the spokesperson of the International Monetary Fund (IMF), Julie Kozackwho tweeted “We welcome recent market access and the measures announced to strengthen the monetary and exchange framework, reconstitute reserve buffers and promote growth-boosting reforms. We are working closely with the authorities in the implementation of these important measures.” An acknowledgment that it was more of a requirement of the body itselfwhich in this month’s review must grant a “waiver“(sorry) to the Argentine government for having been very far from meeting the reserve accumulation goal.
It is estimated that the net reserves are in negative due to US$ 17,000 million (according to the IMF accounting methodology), while the goal was negative US$3 billion.
Caputo hoped to have a “shield” from international funds, in the order of US$20 billion, and is now desperately seeking a short-term “repo” for some US$4 billion. In the middle he must have Seek financing at one of the most expensive interest rates in dollars (9.26%)and grant a new reduction in withholdings to agro-exporters to ensure that they liquidate the dollars from the harvest more quickly.
The problem is that the Government needs dollars to pay the debt maturities of Januaryfor some US$4.7 billion. The cost is paid by the adjustment of public spending and the pockets of the working majorities.
Despite having had record exports and a favorable trade balance, a millionaire disbursement of US$ 14,000 million from the IMF and Trump’s electoral rescue of Milei, More foreign currency left than came in and reserves were diluted. This is so because of the numerous debt maturity paymentsthe flight of capital carried out by multinationals and concentrated national groups in a hidden way, the outflow of dollars for tourism and the opening of imports.
The exit from the devaluation for which sectors of the “market” are pressing, although for the moment it is a flexibility of the band scheme, is expressed in inflationary effects and punishes the pockets of the working majorities.
To defend the national currency and avoid market shocks The working class must impose its own solution, cutting off all avenues of capital flight with the centralization of the banking system in a single central bank, managed by its workers, and the nationalization of foreign trade. And fundamentally through a sovereign ignorance of the external debt, which starts from an investigation of its illicit actions and is conquered with popular mobilization.
Caputo seeks to maintain “exchange stability” and debt payments with a destruction of salaries and the productive apparatus, while they try to pass the slave labor reform that liquidates basic labor rights. Therefore, given the surrender of the union centers, it is necessary to fight to impose a true national strike and a plan to fight until they are defeated.
Source: www.laizquierdadiario.com
