Georgieva, Bessent Discuss U.S. Aid to Argentina
The strategy aims to stabilize Argentine bond prices through the elections, preventing a spike in yields that could worsen market volatility
Quick overview
- IMF Managing Director Kristalina Georgieva discussed coordinated support for Argentina's economic reforms with U.S. Treasury Secretary Scott Bessent.
- The talks include a $20 billion currency swap aimed at providing liquidity for Argentina's central bank reserves.
- Argentina's economic team is seeking U.S. Treasury intervention in the sovereign bond market ahead of October's legislative elections.
- A significant announcement regarding U.S. support is anticipated around October 14, coinciding with a meeting between Presidents Trump and Milei.
IMF Managing Director Kristalina Georgieva said she had an “excellent conversation” with U.S. Treasury Secretary Scott Bessent regarding coordinated support for Argentina’s economic reforms, as the country’s economic team travels to Washington to finalize negotiations over financial assistance. She also signaled upcoming talks with Economy Minister Luis Caputo.
“Excellent conversation with @SecScottBessent on coordinating support for Argentina’s comprehensive reforms. We discussed the broad U.S. financial assistance plans, including the use of U.S. SDR holdings. I look forward to talks with Argentine authorities in the coming days,” Georgieva posted on X.
The discussions go beyond consolidating a $20 billion currency swap meant to provide immediate liquidity for the Argentine central bank’s reserves. Negotiations will focus on duration, tranches, and interest rates of the swap, as well as restrictions on using those funds for import payments.
How the U.S. Treasury Could Step In
Argentina’s economic team is pushing for an even more ambitious role from the U.S. Treasury. Officials hope Washington will directly intervene in Argentina’s sovereign bond market in the run-up to October’s legislative elections. This could involve selective secondary-market bond buybacks to absorb selling pressure, or even primary-market purchases to help reduce debt stock without requiring large cash disbursements.
The strategy aims to stabilize Argentine bond prices through the elections, preventing a spike in yields that could worsen market volatility and deepen the gap with global peers.
These expectations are not unfounded. Sources familiar with the talks say some of the measures echo ideas previously outlined by Bessent as part of a broader plan to reinforce financial stability—while also serving U.S. geopolitical interests in the region.
The big announcement could come as soon as October 14, when Presidents Donald Trump and Javier Milei meet at the White House. Markets are watching closely to see if Washington’s support materializes before then.
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