Forex Today

Argentina and IDB agree to $5 billion deal as foreign reserves dwindle By Reuters

    Share on Facebook Share on Twitter

    © Reuters. Customers line up to buy produce in a market as inflation in Argentina hits its highest level in years, causing food prices to spiral, in Buenos Aires, Argentina April 12, 2022. REUTERS/Mariana Nedelcu

    BUENOS AIRES (Reuters) – Argentina and the Inter-American Development Bank (IDB) agreed on Tuesday to expand financing to the South American country to almost $5 billion between 2022 and 2023.

    The agreement comes as Argentina seeks to leave behind financial turmoil that has raised inflation to over 90% this year, pushing consumption and economic activity down and over 40% of the population into poverty.

    After a meeting between Argentine and bank officials, IDB President Mauricio Claver-Carone told reporters that the bank and the country have drawn up a plan to unlock “what was stuck,” alluding to recent doubts about financing Argentina.

    Sources with knowledge on the matter told Reuters that more than $3 billion of the agreed total would be sent to Argentina this year.

    The idea came after negotiations were held in Washington between representatives from Argentina’s economy ministry and the IDB, a government source said, adding that the country urgently needs foreign currency to avoid a depreciation of the peso in the midst of high inflation.

    Of those $3 billion, $1.2 billion would be freely available and would be disbursed in two steps: $500 million before Sept. 30 and $700 million before Dec. 30, according to the Argentine government source.

    In 2023, the agency will disburse another $1.8 billion.

    “This measure … allows us to show the strength that we want our central bank to have in reserves,” Argentine Economy Minister Sergio Massa said after the meeting with IDB officials.

    Originally Published Here -Source link

    0 0 votes
    Article Rating

    Pound Up As Construction Data Beats Estimate

    Previous article

    You may also like

    More in Forex Today

    Notify of
    Inline Feedbacks
    View all comments