Argentina Secures $20 Billion Currency Stabilization Deal with U.S.

Argentina's central bank announced a $20 billion exchange rate stabilization agreement with the U.S. Treasury Department ahead of midterm elections. Despite a lack of technical details, the deal aims to bolster Argentina's monetary policy arsenal amid economic reforms and political uncertainties linked to upcoming votes.

Argentina's central bank revealed on Monday a $20 billion exchange rate stabilization pact with the U.S. Treasury, strategically timed just six days before crucial midterm elections. The arrangement outlines bilateral currency swap operations to bolster Argentina's monetary and exchange rate policy toolkit.

Although specific technical details remain undisclosed, the central bank emphasized the agreement's role in enhancing Argentina's capability to manage foreign exchange and capital market volatility. The U.S. Treasury has yet to issue an official statement on the swap line.

Treasury Secretary Scott Bessent highlighted the backing of International Monetary Fund Special Drawing Rights from the Treasury's Exchange Stabilization Fund for the arrangement, which aligns with Argentina's commitment to fiscal austerity and reform. The political landscape remains tense, with upcoming elections pivotal for President Javier Milei's party.

(With inputs from agencies.)