The Central Bank (BCRA) reported two key changes that will impact on interest rates. The monetary entity confirmed that it will stop offering Fiscal Liquidity Letters (LEFI) and that, in advance to expiration, They will redeem the Lefi stock in the BCRA asset for Lecaps that cite in the secondary market. They also announced adjustments in the Lace policy with the objective of “reduce distortions and strengthen monetary control.”
“The Fiscal Liquidity Letters (LEFI), which fulfilled their purpose of facilitating the elimination of the remunerated liabilities of the BCRA during phase 2 of the stabilization program, have as its expiration date on July 17, 2025. As of July 10, 2025, the BCRA will stop offering financial entities the possibility of subscribing Lefi, ” The monetary entity detailed on Monday.
According to the BCRA, “the Lefi absorbed surplus bank liquidity, transferring the obligation of their remuneration to the national treasure” so that The banks used the Lefi to manage their liquidityas highlighted, in a transition context towards A monetary framework aimed at eliminating inflation and promoting credit to the private sector. “When this monetary surplus was reduced, its stock went on to represent minimal transactional balances,” they confirmed.
It should be noted that Lefi (Fiscal Liquidity Letters) They were instruments issued by the National Treasury that replaced The paid liabilities of the Central Bank (such as passive passes). These instruments capitalized interest at the monetary policy rate of the BCRA (currently in 29% TNA) and could only be negotiated between the BCRA and the banks. The Government launched them in 2024 to clean up the balance of the Central Bank and eliminate the monetary issuance generated liabilities such as LELIQ and passes. When transferring that debt to the treasure, it was sought to cut a key source of inflation and move towards the “zero emission”.
However, at present, for the BCRA the placement of Lefi at predetermined rates and without price in the secondary market, It began to attract balances that, in an orderly monetary system, could be channeled towards conventional liquidity alternatives. That is why they explained that, from now on, banks can Reorient These balances to other applications such as their Current accounts in the BCRA, titles of the Ministry of Economy, Couciones in the private market or other instruments that they determine.
In parallel they confirmed that before expiration, The Ministry of Economy and the BCRA will redeem the Lefi stock in the BCRA asset for a short -term title portfolio in pesos (LECAPS) with price in the secondary market.
“This rearrangement consolidates a more conventional monetary aggregate control framework, eliminating the notion of monetary policy interest of schemes like inflation targeting. Instead, the interest rate will be determined endogenously by the market, in line with a regime focused on monetary aggregates, “they determined
Lefis are eliminated: what repercussions will bring on interest rates
“The Lefis were Treasury Lyrics that the Central Bank was responsible for managing and served to remunerate idle bank balances. The Lefis came to replace the famous passive passes, Leliqs, etc. Now all that balances are going to have to look for other instruments, the first thing will be short lecaps. We are very likely to see virtual wallet rate down strongly “, He said CEO of Capital coconuts, Ariel Sbdar After the information was known.
In turn, Federico Machadoeconomist of the Policies Observatory for the National Economy, said that Lefi’s non -renewal at the expiration of Julio represents “The final step in the standardization of monetary policy”. “From now on, The BCRA will administer liquidity through bond operations in the secondary market, as usual in other countries with floating exchange rate. “
For this expert this means that There is no more monetary policy rateand the “monetary aggregates” regime is consolidated. “This could have An upward impact on the interest ratesince there will no longer be the option of remunerating monetary balances one day. The bank liquidity will be applied to short letters or to the current account of the BCRA with 0%remuneration, “he explained.
It should be noted that The monetary aggregate regime is a monetary policy strategy that seeks to control inflation by limiting the amount of money in circulation. To do it, instead of setting an interest rate, The Central Bank sets goals about the growth of certain “aggregates” (as M1 or M2). In this way, the government terminates the use of the monetary policy rate as an anchor in the disinflation process.
Balance sanitation and monetary emission elimination
The BCRA also announced that On June 10, 2025, a repurchase of sales options (PUTS) on Treasury titles held by banks will be carried out. This measure complements the operation carried out on July 18, 2024.
According to the BCRA, this decision “is part of a strategy to eliminate potential sources of monetary expansion, strengthen the control of monetary aggregates and strengthen the predictability in the reduction of inflation.”
Puts are instruments that allow banks to sell titles to the BCRA under certain conditions, representing a potential source of monetary emission. By repurcharging these contracts, the BCRA seeks to eliminate this contingency and advance in the sanitation of its balance and, as they announced, align with a monetary policy focused on monetary aggregates.
Source: Ambito
