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Argentina's central bank announced the intervention in the currency market



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According to a statement published Monday the Committee on Monetary Policy (Copom) by the Central Bank, the financial institution can sell the US currency, "even if the exchange was located below 51,448 pesos"

Argentine Central Bank (BCRA) announced on Monday the intervention in the currency market to "more aggressively to reduce the amount of pesos", among which sell dollars even if the exchange rate is within the so-called non-interference zone.

According to a statement published Monday the Committee on Monetary Policy (Copom) by the Central Bank, the financial institution can sell the US currency, "even if the exchange was located below 51,448 pesos" to the number and frequency depend on "market dynamics".

If the exchange rate is exceeded, the BCRA will increase from US $ 150 to US $ 250 million for & # 39; The volume of daily sales, as well as You reserve the option "additional intervention to resist episodes of excessive volatility in case of need. "

Number of pesos as a result of these sales will be calculated with base money targets.

He also confirmed that the Copom will not buy foreign currency to June 2019, when the exchange rate was below 39,755 pesos.

These measures come in order to reduce the amount of weight and improve the functioning of the foreign exchange market.

"Copom considers that the Central Bank should strengthen the deterrent bias of monetary policy Intervention in the foreign exchange market more aggressively to reduce the amount of pesos and thereby contribute to the normal functioning of the market, "the statement said.

Thus, the Central Bank has changed the policy adopted in October last year in the area was established intervention and non-intervention in the currency market, announcing in a scheme run by the growth of profitability of the monetary base, partly induced by the agreement reached with the International Monetary Fund, which set limits on foreign exchange intervention .

About & # 39 announcement comes after a week in the Argentine peso devaluation gain against the US dollar, the currency gained in 2018 an increase of 104%. So far in 2019 the cumulative growth rate of 18.9%

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