MercoPress. South Atlantic News Agency

Argentine Economy Minister seeks help from Bessent and Georgieva

An announcement is expected after Caputo's trip to Washington

Argentine Economy Minister Luis Toto Caputo held key meetings on Monday in Wasdhington, DC, with US Treasury Secretary Scott Bessent and International Monetary Fund (IMF) Managing Director Kristalina Georgieva in search for a lifeline ahead of the Oct. 26 midterm elections when the ruling La Libertad Avanza (LLA) of President Javier Milei will seek to build political muscle to face the administration's remaining two years. A concrete announcement is expected from Caputo's meetings.

Bessent confirmed the meeting on social media, stating that they would continue “productive discussions on the several options that Treasury has at the ready to support Argentina's strong policies.” He previously stated that the support would likely be a swap line rather than a direct cash injection, framing the assistance as essential for maintaining US strategic interests in the Western Hemisphere. He emphasized that there were “several options” ready to support Argentina's policies. The meeting and Bessent's words signaled the Republican administration oof President Donald Trump's firm commitment to supporting Milei's stabilization plan.

“I am pleased to welcome Caputo and the Argentine delegation to the Treasury Department. During their stay here in Washington, we will continue our productive discussions on the various options the Treasury has prepared to support Argentina's strong policies,” Bessent posted on X.

Georgieva said she had an “excellent conversation” with Caputo and confirmed that the IMF was working closely with Argentina and the US Treasury to promote stability and growth. She also admitted that economic aid could include Special Drawing Rights (SDRs), also referred to as “IMF money.”

Milei is scheduled to visit the White House on October 14, leaving open the possibility that financial aid could arrive before the elections.

With the Argentine Central Bank's (BCRA) reserves currently standing at US$42.698 billion, the Argentine Treasury was forced to remain the primary seller of foreign currency on Monday to meet persistent high demand for US dollars The government raised the intervention ceiling for its dollar sales to $1,430, which was the closing price for the day, representing a 0.4% rise.

Analysts project the gap between private sector demand and genuine private sector dollar supply will be at least US$5 billion in the weeks before the midterms. Argentina's negative dynamic is rooted in long-term external accounts: the current account has shown an external deficit in 13 of the last 15 months, exacerbated by significant capital flight since currency controls were lifted in April.