Argentina has formalised a currency swap agreement with the United States worth up to $20 billion, a move aimed at supporting the country’s fragile economy and stabilising the peso ahead of key midterm elections on October 26.
In a statement on Monday, the Central Bank of Argentina said the swap line was designed “to contribute to Argentina’s economic stability,” as the nation battles renewed inflationary pressures and currency volatility.
The agreement forms part of broader financial backing from the administration of US President Donald Trump, a vocal supporter of Argentine President Javier Milei, who faces mounting political and economic challenges as he seeks to strengthen his reformist agenda.
Argentina’s peso has been on a turbulent ride in recent weeks, undermining consumer confidence and fuelling fears of further depreciation.
Alongside the swap deal, US Treasury Secretary Scott Bessent last week announced plans to secure an additional $20 billion facility from private banks and sovereign wealth funds to shore up Argentina’s reserves and boost investor confidence.
Milei, once celebrated globally as a libertarian reformer for his aggressive fiscal tightening measures, has struggled to steady the economy after burning through much of the central bank’s dollar reserves in a bid to defend the peso.
Inflation, which initially eased following his inauguration in December 2023, has resumed an upward climb, deepening the strain on households and eroding purchasing power.
During a meeting with Milei at the White House last week, Trump issued a stern warning to Argentine voters, suggesting that continued US financial assistance hinged on Milei’s political survival.
> “If he loses, we are not going to be generous with Argentina,” Trump said.
The development underscores Washington’s growing political and economic influence in Buenos Aires as Milei’s government seeks to avert another financial crisis and restore market confidence ahead of the polls.
