Argentina is asking the International Monetary Fund for early release of funds from the country’s $50 billion standby financing deal, President Mauricio Macri said in a televised address on Wednesday, a move aimed at calming turbulent markets.
Argentina is asking the International Monetary Fund for early release of funds from the country’s $50 billion standby financing deal, President Mauricio Macri said in a televised address on Wednesday, a move aimed at calming turbulent markets.
The country’s currency has weakened 40.79 percent in 2018. Investors are concerned that with high inflation, a weak economy and fallout from a global selloff in emerging markets, Argentina may have problems meeting its dollar debt obligation in 2019.
« We have agreed with the International Monetary Fund to advance all the necessary funds to guarantee compliance with the financial program next year, » Macri said. « This decision aims to eliminate any uncertainty. »
The Argentine peso dropped to trade more than 6 percent lower against the dollar on the news.
Argentina’s central bank sold a total of $200 million of its reserves in two currency auctions on Tuesday after the peso hit new lows. The currency weakened to a record close of 31.50 per dollar after touching an all-time low of 31.60 to the greenback earlier in the day.
Central bank shows it has sold $12.881 billion in the foreign exchange market this year as monetary policymakers try to stabilize the currency. The government says it expects the country’s economy to contract 1 percent in 2018 but grow by at least 1.5 percent next year.
