MercoPress. South Atlantic News Agency

Argentine Peso at an equilibrium point, says head of Central bank

Caputo also hinted that a revised deal with the IMF will continue to calm the markets and add clarity on fiscal, monetary and exchange market fronts

Argentina’s central bank now sees the Peso at an equilibrium level, chief Luis Caputo told market participants who attended a meeting with him on Thursday. The statement comes after two days of strengthening by the peso following a rout that sent it to a record intra-day low in late August.

Caputo also hinted that a revised deal with the International Monetary Fund will continue to calm the markets and add clarity on fiscal, monetary and exchange market fronts, in a meeting at the central bank with local market participants.

The meeting, aimed at fostering market dialogue, included around a hundred local market participants including brokers, mutual funds, the securities regulator, according to people with direct knowledge of the matter.

Chief among concerns voiced by market participants were a lack of liquidity in local instruments including short-term Treasury notes known as Letes. The concerns come as the central bank moves to phase out its stock of its own short-term notes, known as Lebacs, which had became an investor favorite.

The central bank said it’s now seeing liquidity growing as retail investors participate in dollar and peso-denominated Letes sales, and that it’s working with banks to launch a market maker for local instruments.