What Happened: Argentina's central bank will set a currency band in an effort to stabilize the country's currency, Clarin reported Sept. 21. The bank will buy or sell U.S. dollars when the peso reaches a ceiling between 40 and 44 pesos per U.S. dollar or a floor between 32 and 36 pesos per U.S. dollar.
Why It Matters: Argentina's government is working to avoid setting up foreign currency controls such as those implemented under the previous administration. But the International Monetary Fund (IMF), which entered into an agreement with Argentina to assist it through its economic crisis, has pushed Buenos Aires to hold on to its foreign currency reserves. It is unknown whether the organization approved the currency band.
Background: Argentina and the IMF signed an agreement in May for a $50 billion standby loan. Not all of that money has been turned over to Buenos Aires, and the two sides are negotiating further terms of the deal.
- How a Rising U.S. Dollar Puts Argentina's and Brazil's Economies at Risk (June 28, 2018)
- Why Argentina's Leader Is in for a Tough 2019 (June 1, 2018)
- Taming the Twin Headaches of Argentina's Economy (April 26, 2018)
- The Myth of Argentina's Failure (May 17, 2017)