U.S. buys Argentine pesos, finalizes $20-billion currency swap
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- The U.S. directly purchased Argentine pesos and finalized a $20-billion currency swap to provide stability amid the country’s economic turmoil.
- Critics call it a bailout contradicting Trump’s “America First” agenda, rewarding his friend President Milei ahead of crucial October midterm elections.
- Argentina is the IMF’s biggest borrower with $41.8 billion outstanding, while U.S. farmers complain about losing soybean sales to China.
WASHINGTON — The U.S. directly purchased Argentine pesos on Thursday and finalized a $20-billion currency swap framework with Argentina’s central bank, Treasury Secretary Scott Bessent said in a social media post.
The intent is to provide assistance from the Latin American country’s economic turmoil.
“U.S. Treasury is prepared, immediately, to take whatever exceptional measures are warranted to provide stability to markets,” Bessent said, adding that the Treasury Department conducted four days of meetings with Argentinian Finance Minister Luis Caputo in Washington to come up with the deal.
Bessent has insisted that the Argentina credit swap is not a bailout. Last month, President Trump stopped short of promising Argentine President Javier Milei a financial bailout from the Latin American country’s economic turmoil.
Still, U.S. farmers and Democratic lawmakers have criticized the deal as a bailout of a country that has benefited from sales of soybeans to China, to the detriment of U.S. farmers.
Argentina is one of the biggest Latin American economies and the biggest borrower from the International Monetary Fund — its total outstanding credit as of Aug. 31 is $41.8 billion.
The offer to financially help Argentina comes as Trump has frequently promoted his “America First” agenda. Critics contend that the planned intervention is a way to reward a personal friend of Trump’s who is facing a critical midterm election this month.
Milei celebrated Bessent’s announcement on social media, hailing Caputo as “far and away, the best Minister of Economy in all of Argentine history…!!!”
Argentina’s deregulation minister, Federico Sturzenegger, also congratulated Caputo and the rest of the economic team. “Let’s keep working so that our children want to stay and live in Argentina,” he wrote, adding a pitch to voters to support Milei in the crucial midterm elections later this month.
Hussein writes for the Associated Press. AP writer Isabel DeBre in Buenos Aires contributed to this report.
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