Argentina’s central bank will begin selling U.S. dollars in parallel foreign exchange markets to combat inflation and freeze the country’s money supply, announced Economy Minister Luis Caputo on Saturday via platform X. This move aims to deepen the disinflation process.
Starting Monday, the central bank will balance Argentina’s monetary base by selling dollars in the “CCL” exchange market when it issues pesos to buy dollars on the formal market. Caputo emphasized that no more pesos would be printed, calling it a historic step.
This announcement follows data showing an increase in monthly inflation in June, ending a five-month streak of slowing inflation. The strategy aims to stabilize the money supply and narrow the gap between Argentina’s official and parallel exchange rates.
The peso has been declining in parallel markets, with the official rate at 919.5 pesos per dollar and the “CCL” rate at 1,416.2 pesos per dollar. The black market “blue” rate hit a historic low of 1,500 pesos per dollar.
President Javier Milei praised the announcement, noting its potential to accelerate economic deflation. Since Milei took office last year, inflation has significantly slowed, dropping from 25.5% in December to 4.6% in June.