What is the Blue Chip Swap and why the Treasury warned that it already operates there

However, The United States Treasury announced that it has expanded its range of action. Bessent spoke about his intervention in the “Blue Chip Swap”, in addition to operations in the spot market. This is the market Cash With Settlement (CCL) as it is known in the local square. The thing is that years ago, these same operations were carried out by purchasing shares of the most important listed companies such as YPF, Galicia, Tenaris, the same ones that in the US – and based on their large market capitalization – are known as “blue chips”.

Needless to say, operationally, the CCL acts as an arbitration that circumvents exchange rate restrictions between bands. It involves the purchase of an asset in pesos in the local market—such as bonds or stocks—and its subsequent settlement in dollars in foreign markets, typically via American deposit certificates (ADRs) or bonds. This generates an implicit exchange rate above the official onewhich absorbs the unsatisfied demand for foreign currency. The US Treasury’s operation to intervene in its price is the opposite: it buys an asset with dollars and settles it against pesos.

The move was highlighted today by Bessent himself, who highlighted that the US government is “directly” involved in the containment of imbalances in the Argentine exchange market. In his post, Bessent specified that the Treasury acquired pesos in the Blue Chip Swap and in the spot segments, and that it maintains a close link with the local economic team in its eagerness to reinvigorate the growth agenda. He stressed that the entity comprehensively supervises the markets and has instruments to deploy promptly and vigorously, if required.

Vacuum cleaner of pesos and the attempt to contain the dollar

By absorbing pesos in these alternative flows, The Treasury aims to extract internal liquidity, narrow the exchange gap and stop migration towards the dollarin a panorama where the wholesale exchange rate rose 1.6% to $1,402, with intraday highs at $1,430 this Thursday, while this Friday it opened again higher. While, as mentioned, the financial dollars —MEP and CCL— climbed above $1,470 and $1,490, respectively. Recent operations included sales for about US$120 million in cash, executed via the Santander bank on account of the Treasury, totaling US$100 million the previous day.

For analysts, Investment concerns will become even more acute on the eve of the election. The fact is that October 26 is the horizon for an eventual rethinking of the exchange rate scheme.

In this framework, the American ambassador in Buenos Aires, Peter Lamelasanticipated “great news” that will strengthen the bilateral economic alliance. In parallel, an assistance package for US$40,000 million is being outlined, which includes a swap line for 20,000 million and an additional fund of the same amount made up of private banks and sovereign funds, aimed at supporting Argentine debt payments.

A loan for Luis Caputo

In another gesture of financial support towards Argentina, it emerged that four leading US banks, JP Morgan, Bank of America, Goldman Sachs and Citigroup, They already have conversations with him US Department of the Treasury to grant up to US$20,000 million in loans to the countryas revealed this Thursday by Semafor, an American media specialized in economics and global politics.

The objective is complement the official assistance of a swap of another US$20,000 million, already announced by the administration of donald trumpat times when the economic stagnation and exchange rate instability They deepen a few days before the legislative elections of October 26.