Milei Postpones Central Bank Shutdown and Currency Overhaul in Argentina

Argentine President Javier Milei has postponed his plans for dollarization in 2024, citing the need for more time to stabilize the economy.

Milei, known for his libertarian stance, had pledged to dismantle the Central Bank of Argentina and phase out the national currency. However, he explained in a recent interview that the process of cleaning up the bank’s operations alone would take until at least June, with the entire financial system overhaul potentially requiring a year.

Despite the delay, Milei emphasized that dollarization remains the ultimate objective of his administration, leveraging Argentina’s existing dollar reserves to support the transition. He also hinted at a diversified currency system post-deregulation, allowing different sectors to operate with various currencies, thereby reducing dependency on the monetary policies of individual countries. Notably, discussions regarding dollarization have not yet taken place with the International Monetary Fund, which recently greenlit a $4.7 billion disbursement as part of Argentina’s debt restructuring efforts.

Clever Robot News Desk 9^th February 2024