The Argentine peso showed signs of weakening once more on Tuesday (30), prompting the Milei administration to take action to prevent the currency devaluation, following a show of support from the United States that boosted the country’s assets.
The Argentine peso experienced a significant drop of more than 6% in a single day, marking the largest intraday decline since September 8. Following this, the government intervened by selling dollars in the market, leading to a 1.4% decrease in the peso’s value to 1,380.0 pesos per dollar at the close of the day. Details regarding the government’s negotiation efforts have not been disclosed, as neither the central bank nor the Ministry of Economy has provided any comments or information in response to inquiries.
The double-drop pattern indicates a rapid change in the currency’s direction, which had previously increased by over 10% following the announcement of a $20 billion package by US Treasury Secretary Scott Bessent.
A brief decrease in export taxes generated R $ 7 billion in a short period, supporting the upward trend, but the reintroduction of previously lifted capital controls in April did not prevent the resumption of devaluation this week.
The Milei administration used a recent opportunity to purchase dollars and boost reserves, but is struggling to curb the high demand for US currency. This demand is fueled by uncertainties surrounding the president’s political backing ahead of the upcoming midterm elections in October, following a significant loss in a local Buenos Aires election in September and ambiguity regarding future exchange rate policies.
The lack of information regarding the US package is also affecting investments. Milei, who recently came back from a trip to the US, is scheduled to meet with Trump at the White House on October 14.
- Global
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- The United States of America
- Government
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- Money
- Scott Bessent
