Bessent signals US willingness to offer Argentina a credit line

US Treasury Secretary Scott Bessent said the Trump administration would be willing to offer Argentina’s government a specific credit line if a global shock jeopardised President Javier Milei’s economic turnaround, according to three people with direct knowledge of his comments.

The US government would be willing to use the Exchange Stabilization Fund, or ESF, to support Argentina, if something happened through no fault of its own as long as Milei stays the course on his economic policies, Bessent said Tuesday at a JPMorgan Chase & Co event in Washington, according to the people.

A US Treasury spokesperson didn’t immediately respond to a request for comment.

Argentina bonds rose during Tuesday trading after the remarks, and were among the best performers in emerging markets. Benchmark notes due 2035 rose as much as one cent to trade at some 66 cents on the dollar, according to pricing data compiled by Bloomberg.

Analysts pointed toward Bessent’s comment at the closed-door event Tuesday for lifting Argentine assets.

“Bonds rose because there’s an increasing expectation that the US will have Milei’s back in the case of a crisis”, said Carolina Gialdi, head of international sales at Max Capital in Buenos Aires, who didn’t attend the event in Washington. “Averting a crisis would reduce the political risks of Peronism returning to power, currently latent in bond price,” she added, referring to the populist movement that’s dominated Argentine politics in the past.

Created in the 1930s, the ESF has been part of over a hundred credit or loans by the US Treasury to foreign governments and central banks to help stabilise currencies, according to the Treasury website.

Bessent’s latest comments appear to go a step beyond his remarks in an interview with Bloomberg News in Buenos Aires last week, where he visited Milei and praised his reform agenda as a model for other pro-market governments in Latin America. 

“At the end of the day, we have the Exchange Stabilization Fund, too. We haven’t committed to being part of that, but could be,” Bessent said April 14 during a rare visit for a US Treasury secretary to the crisis-prone nation.  

The Trump administration proved crucial to Argentina securing a $20 billion program with the International Monetary Fund earlier this month.