Argentina Tuesday made a payment to the Paris Club which resulted in the country's reserves falling to the US $ 42,837 million, it was reported.
Argentina will not allow a chaotic fall in the peso and will use its dollar reserves to bolster the currency against political uncertainty that has swept the country since the Aug. 11 primary election, Treasury Minister Hernan Lacunza said on Wednesday.
Argentina's central bank said on Friday it had sealed a deal for a US$5 billion, one-year loan from international private banks, bolstering its low foreign reserves as the country heads into talks with creditors suing over unpaid debt. Argentina has been shut out of global credit markets because of its long-running legal dispute in U.S. courts with creditors over debt it defaulted on in 2002.
Argentina Central Bank President Alejandro Vanoli resigned Wednesday under pressure from President-elect Mauricio Macri, who plans to remove currency controls with reserves standing at a nine-year low.
Argentina's election season has dramatically changed the agricultural landscape in the country, one of the world's breadbaskets. Exporters are now more confident than ever that profits will soar next year, creating a short term impact of plunging sales abroad and reduced cash-flow in the Argentine Central Bank’s coffers, although that could change in 2016.
Argentina on Tuesday halved the daily amount of dollars companies can transfer abroad without authorization, currency traders said, while the country's insurance regulator put new limits on the amount of hard currency assets insurers can hold.
Argentina's central bank on Monday afternoon confirmed the 5.9 billion dollar payment Argentina was due to make ended successfully, adding “the level of reserves is enough for the execution of our exchange policy.”
Argentina confirmed it will be using Central Bank foreign-currency reserves to service more than US$3.5 billion dollars in international debt that matures in October. The confirmation came through an announcement in the Official Gazette, signed by President Cristina Fernández, Cabinet Chief Anibal Fernández and Economy Minister Axel Kicillof.
The informal of “blue” dollar in Argentina fell back 15 cents to 15.55 Pesos after it skyrocketed 75 cents last week and scraping 16 Pesos. The formal US dollar meantime advanced three cents to 8.49 Pesos at the end of trading in Buenos Aires City banks and foreign exchange offices. The gap between the two rates dropped to 83.9%.
Argentine central bank international reserves continued to erode and on Wednesday pierced through the 30bn floor threshold reaching 29.858bn dollars, the lowest level since November 2006. On Tuesday reserves stood at 30.019bn.