Argentina tweaks FX rules after cost of getting dollars out surges

Argentina’s government issued new rules for investors moving money out of the country after increased use of the parallel foreign-exchange market drove the cost of such trades to its highest in a year.

The Central Bank, in a package of measures published late Thursday, added a new so-called cross restriction on the “blue-chip swap,” used by financial institutions and sophisticated investors. Simultaneously, it eased deadlines for the settlement of FX transactions using the official rate, including for exports.   

In recent weeks, individuals and companies in Argentina were increasingly turning to that parallel rate to allow them to send foreign currency abroad, complicating Economy Minister Luis Caputo’s efforts to rebuild reserves.

Higher demand to move dollars out of Argentina risks of putting pressure on the peso and fanning inflation, which could further dent President Javier Milei’s approval ratings. Inflation has already accelerated for several months, and Milei’s popularity with voters is rooted in keeping it under control.

While the easing of some controls on individuals is seen as positive, “there’s another negative signal in the tightening of restrictions” on those moving money abroad, according to Gabriel Caamaño, an economist at consulting firm Outlier. “The main reason for curbing this arbitrage is that the operation was eating into the Central Bank’s ability to accumulate reserves,” he said.

The extra cost investors pay to take dollars abroad – instead of keeping them onshore – has been rising steadily this year. The economy, meanwhile, is approaching its peak season for dollar inflows, driven both by exports and companies distributing dividends and bonuses. 

While many companies bring in dollars to make such payments at home, several others pay them abroad. One of Caputo’s deputies, José Luis Daza, said Wednesday at a conference that, over the past month, foreign companies in Argentina paid US$1 billion in dividends abroad.

Late last year, the government announced an ambitious foreign-currency purchase programme aimed at strengthening reserves, which is a key concern for both investors and the International Monetary Fund. The Central Bank made its biggest purchase of the year – US$281 million – on Thursday. 

Prior to that, the monetary authority had bought more than US$4.3 billion so far this year. But net reserves remain broadly unchanged from the start of the year, according to research by Buenos Aires-based Banco Comafi.

The gap between the blue-chip swap and the so-called dollar MEP, used to dollarise locally, widened past four percent this week. The spread remained below two percent for most of 2025. The gap with the official rate also climbed to seven percent, its highest since December.

The divergence between these rates had widened last year after Milei imposed cross restrictions ahead of midterm elections, barring participants in the official market from accessing parallel markets. It widened again last month amid rising global risk aversion that triggered sell-offs across emerging markets. 

Caamaño sees the government’s latest move as negative over the longer term “because it implies more restrictions, not fewer, and opens the door to further increases in the FX gap and the swap rate.”

Argentina is expecting a surge in foreign-currency inflows in coming weeks, driven by agricultural exports, stronger trade flows from the energy sector, and hard currency raised through foreign direct investment and overseas corporate debt issuance – which is at its highest in five years. 

Still, other factors are offsetting those inflows. Among them is a method used to take advantage of the interest-rate differential between assets priced in separate currencies.

“An unwind of the carry trade by investors is starting to emerge,” said Carolina Schuartzman, director of sales and trading at Banco de Valores. “The strategy delivered solid dollar returns in Argentina,” she added, “and many investors now see merit in taking profits and stepping aside, awaiting calmer market conditions.”