Washington: The United States has signaled robust support for Argentina’s embattled economy, announcing plans for a $20 billion currency swap line and readiness to purchase U.S. dollar-denominated Argentine bonds, Treasury Secretary Scott Bessent confirmed on Wednesday. The measures aim to stabilize Argentina’s markets and bolster investor confidence amid political and economic uncertainties.
Bessent emphasized that Argentina possesses the tools to counter speculative attacks and market destabilization, particularly those motivated by political objectives. Beyond the swap line, the U.S. is prepared to extend significant standby credit via the Exchange Stabilization Fund and purchase secondary or primary government debt as needed. Additionally, Washington is coordinating with Buenos Aires to phase out tax exemptions for commodity exporters converting foreign currency, a step aimed at reinforcing fiscal discipline.
The announcement follows the meeting of U.S. President Donald Trump with Argentine President Javier Milei during the United Nations General Assembly in New York. Both leaders expressed optimism over ongoing economic reforms and pledged to strengthen bilateral cooperation. Milei, a close ally of Trump, publicly thanked the U.S. for its commitment to Argentina’s stability, emphasizing shared values and a vision for sustainable growth.
The immediate market response to Washington’s pledge was positive. Argentina’s government bond prices surged, with the 2030 issue gaining over four cents, while local stocks edged higher. The Argentine peso also strengthened following a week of sharp currency depreciation that had required the central bank to spend over $1 billion defending it. Analysts note, however, that sustained reform and disciplined governance will be essential for long-term stability in the South American nation.
Bessent underscored that the U.S. would not allow market imbalances to derail Milei’s ambitious economic agenda. “The market is looking at decades of mismanagement,” he remarked, but expressed confidence that Milei’s reforms marked a departure from past failures. Argentina’s Economy Minister Luis Caputo echoed the sentiment, calling for collective efforts to ensure lasting economic progress.
With elections approaching and investor sentiment fragile, the United States’ proactive support is viewed as a crucial lifeline for Argentina, offering reassurance amid the country’s ongoing fiscal and political challenges.