Argentina's Central Bank sold as much as US$400 million to defend the peso on Friday, according to traders with direct knowledge of the matter, the most in a day since mid-March.
The sale of Central Bank reserves came just days after the International Monetary Fund announced a new US$20-billion loan accord with Argentina. The agreement has stoked speculation of a one-off devaluation. The Central Bank is expected to confirm the intervention figure in the next few hours.
In an additional step to defend the local currency, the Central Bank suspended one- to seven-day repos that local banks used to buy dollars, according to a statement.
The sale dents President Javier Milei’s attempts to re-build the country’s war chest of hard-currency reserves that are essential to paying international bondholders and eventually lifting capital and currency controls next year. The reserves will be used for more than US$4 billion in bond payments due in July.
The IMF’s executive board is expected to vote on the program with Argentina on Friday.
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