Central Bank of Argentina vice president outlines monetary policy challenges and Stage 3 exchange-rate transition at CEMLA governors meeting

Central Bank of Argentina vice president Vladimir Werning delivered a presentation on “Monetary policy amid current challenges” at the CXVIII CEMLA Meeting of Central Bank Governors in San Salvador on 28–29 May, focusing on external pressures from higher global interest rates and domestic challenges linked to the economy’s move into “Stage 3” of the economic programme, including the introduction of greater exchange-rate freedom. Werning said the Stage 3 transition in the exchange-rate regime has progressed without economic disruptions, with limited and temporary effects on financial variables, inflation and inflation expectations. He attributed the non-disruptive transition in a bi-monetary economy to orthodox macroeconomic policies built on a fiscal anchor and a monetary anchor, and referenced an IMF agreement as providing financial resources to strengthen the Central Bank of Argentina’s balance sheet without increasing consolidated public debt. The presentation also contrasted the 2024–25 programme with the 2016–17 stabilisation attempt, citing a larger decline in inflation, inflation expectations and poverty in 2024–25, the elimination of the central bank’s remunerated liabilities, a stronger recovery in credit (“crowding in”), an earlier and stronger economic recovery with improved external balance, higher private-sector USD surplus, and very low non-resident holdings of local-currency assets linked to carry trade. The Central Bank of Argentina published the presentation for download.