Government seeks to expand currency swap with China for US$5,000 million

Government seeks to expand currency swap with China for US$5,000 million

The initiative, which aims to increase the “swap” announced in November 2022, would give the central bank a greater margin of action to moderate the depreciation of the Argentine peso and deal with inflation that this year could exceed 130%.

A source from the Argentine central bank (BCRA) said that the entity’s president “It is advancing on the renewal of the swap and discussing the possibility of increasing the unrestricted amount.”

“The idea is to have everything closed to travel and sign at the end of the month. This is an agreement signed by the presidents of the BCRA and the BPC (People’s Bank of China),” he explained.

The Minister of Economy, Sergio Massa, and the president of the BCRA, Miguel Pesce, will travel to China between May 29 and June 4. “There may be news about the trip to China,” said a source from the Ministry of Economy, without giving further details.

The southern country, one of the world’s largest food exporters, is going through a difficult economic situation after a severe drought that affected its agricultural production, months before the presidential elections.

As Ámbito learned, Alberto Fernández and Xi Jinping agreed to activate $5 billion of the swap when they met at the Bali, Indonesia summit. The first agreement signed between the BCRA and the People’s Bank of China (BPC) was in mid-January. The model that was negotiated two years ago is the one that opened up the possibility of operating in local currencies in foreign trade, which is now being used more and more. Now, that same agreement must be renewed and the official search is to extend it to another $5 billion.

Source: Ambito

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