The Central Bank of Argentina has reached an agreement with the US Treasury for a US$20 billion swap line, it announced on Monday morning. The swap will allow the country “to respond to conditions that could lead to episodes of volatility in the foreign exchange and capital markets.”
The agreement was communicated to the press through a statement in Argentina. Details of the financial terms of the loan have not been disclosed and, as with Argentina’s swap with China, remain confidential.
“The purpose of this agreement is to contribute to Argentina’s macroeconomic stability, with special emphasis on preserving price stability and promoting sustainable economic growth,” the government said.
“This agreement is part of a comprehensive strategy that reinforces Argentina’s monetary policy and strengthens the Central Bank’s ability to respond to conditions that could lead to episodes of volatility in the exchange and currency markets,” the statement read.
The Central Bank highlighted that the operations will allow “expanding the set of monetary and exchange policy instruments available, including strengthening the liquidity of its international reserves.”
In an interview published on Monday, Milei said that Argentina would use the swap line to make 2026 debt payments in case the country cannot operate in the forex market “due to the country risk being too high.”
“That would be taking debt to pay for debt,” he told Tucumán’s Canal 8 TV station.
Economic hardship In recent weeks, after markets raised doubts over the sustainability of Argentina’s economic plan, the government has been depleting its scarce international reserves to contain a run on the peso. In late September, Milei met in New York with U.S. President Donald Trump, his main international ally. After that short meeting, the U.S. Treasury announced it would grant a full-on bailout for Argentina.
After the announcements, the U.S. began intervening directly in Argentina’s foreign exchange market. Even though that support needed to be strong enough to stabilize the currency, volatility persists.
Last Friday, even with the U.S. Treasury buying pesos, the peso plunged across all markets — the official wholesale rate was up 3.8%, from AR$1,446 on Thursday to AR$1,455 on Friday, while the blue-chip swap rate went from AR$1,491 to AR$1,543.7, a 3.5% variation.
