BUENOS AIRES (Reuters) – Argentina’s central bank on Monday said it would switch its benchmark interest rate to the overnight reverse repo rate of 100% from the previous 28-day Leliq rate at 133%, a move aimed at simplifying monetary policy amid an economic crisis.
“Starting from tomorrow, the bank’s monetary policy interest rate will become the rate for one-day reverse repos, a rate that since Dec. 13 has been established at 100%,” the bank said in a statement.
The move comes days after libertarian President Javier Milei took office, as South America’s No. 2 economy battles inflation nearing 200%.
Economist Santiago Bausili took over the presidency of the central bank, which Milei has pledged to eventually shut down.
The bank added that it considered it “prudent” to maintain a minimum 110% interest rate for fixed-term deposits.
In terms of liquidity injections, the bank said it would continue to carry out certain operations on Treasury instruments which the bank considers appropriate.
(Reporting by Adam Jourdan and Walter Bianchi; Writing by Sarah Morland; Editing by Valentine Hilaire and Mark Porter)
