© Reuters. FILE PHOTO: The facade of Argentina’s Central Bank is pictured in the financial district of Buenos Aires, Argentina December 7, 2021. REUTERS/Agustin Marcarian/File Photo
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.
