In the consensus of economists, the Central Bank justifies its reason for being because it constitutes the network that officiates as a lend of last instance. A problem of the Argentine economy of the last half century was the difficulty to generate currencies so that each crisis ended up defaulted the debts contracted previously to save the recurring deficits in the balance of payments.
Every so often the International Monetary Fund appeared with a bridge loan and with promises from Argentine officials who often exceeded their mandates and therefore were breached. Perhaps the last fiasco in that regard was the “armor” signed in the summer of 2001 that supposedly gave the necessary stability frame to avoid the terminal crisis in which the convertibility had fallen, but that no one was encouraged to break the taboo to convert. In total there were almost US $ 40,000 million contributed by a pool of institutional investors, multilateral organizations and the IMF itself. A bet that was soon revealed as impotent to reverse distrust and eradicate the fiscal deficit that eroded the sustainability of the system. At the end of that year everything flew through the air and the default declared again.
The new renegotiation was with the private creditors through capital removes and bond exchanges, but there was a remnant of “holdouts” that only regularized their situation with a new arrangement in 2016. However, two years later, the account again was put in red, international financing was cut to the deficit treasure and the Macri administration had to go back to a save the background of the background of which US $ 45,000 millions, for which an adjustment was committed but that revived inflation. This agreement, very difficult to comply with, was already restructured under the mandate of Alberto Fernández for US $ 68,000 million again with maturities that accelerated after 2023. This history was what paved the path to the isolation of the voluntary debt market and left the only emergency door in the IMF and some bilateral agreement, such as the reactivated in 2023 with China through the exchange of currencies. The last scene of this saga was the April Agreement with the Fund to make the dollar flotation more flexible, which forced to accumulate reserves, which once again was breached.
The Buenos Aires defeat of September 7 and the expectations of a decline in the government’s political cycle ended in the loss of reserves that threatened to empty how little it was left. But this time, the dynamics that aggravated the situation closed the usual exit of a lifeguard of the IMF. This time he went direct to his main shareholder: the same treasure of the United States. This confirms two things: that the last instance lender is now the last possible and that the counterpart that will require such financial generosity will put other conditions. It is the post -electoral scenario of November.
