US Argentina Finalize $20B Currency Swap Amid Peso Crisis

Argentina has secured a $20 billion currency swap agreement with the U.S. Treasury to stabilize its economy ahead of critical midterm elections for President Javier Milei's party. This deal strengthens Argentina's foreign reserves and supports price stability amidst ongoing economic challenges like high inflation and a recent economic contraction. The swap, facilitated by the U.S. Federal Reserve and potentially lasting up to three years, reflects U.S. confidence in Milei's market-oriented reforms, while additional lending of $20 billion is under discussion to further bolster support. Treasury Secretary Scott Bessent emphasized continued U.S. financial backing contingent on Argentina's economic policies, regardless of election outcomes, and the U.S. has already been purchasing Argentine pesos to stabilize the market. Analysts view the agreement as a critical pillar for Argentina's economic recovery and a signal of Washington's commitment to supporting bold reforms in Latin America. The swap agreement may also improve Argentina's access to IMF funding and supplement or partially replace prior currency facilities, such as one with China.