Argentina central bank directors split over April interest rate hike -source

Argentine central bank directors are split over whether to hike the benchmark interest rate for a fourth time this year when they meet on Wednesday, a central bank adviser with knowledge of the discussions said. The directors are meeting as the South American country battles inflation expected to have topped 6% in March alone.

Argentine central bank directors are split over whether to hike the benchmark interest rate for a fourth time this year when they meet on Wednesday, a central bank adviser with knowledge of the discussions said.

The directors are meeting as the South American country battles inflation expected to have topped 6% in March alone. A recent Reuters poll of traders and analysts estimated the bank would raise the rate, already at 44.5%, by at least 150 basis points in April. The central bank advisor said the directors were concerned about the impact on economic growth despite pressures to tighten monetary policy to rein in inflation.

"There's going to be strong debate at the meeting. There are divided positions between those who want to let April pass without rate adjustments and those who believe it is time to adjust monetary policy again," the person said. A central bank spokesman declined to comment.

Central banks around Latin America are under pressure to maintain aggressive cycles of tightening as inflation continues to surge, defying sharp interest rate hikes and spurring discontent over rising food and fuel prices. Argentina's March inflation, to be announced on Wednesday, will exceed 6%, Economy Minister Martín Guzmán said earlier this week, the fastest monthly price rise since at least 2018.

The grains producing country has pledged to shift towards real positive interest rates as part of a recently finalized $44 billion debt deal with the International Monetary Fund (IMF). The central bank raised the benchmark 28-day Leliq rate to 40% in January, 42.5% in February and 44.5% in March.