Reference News Network, October 22 report. According to AFP, on October 20, the financial support promised by the Trump administration to its Argentine ally Javier Milei was further implemented on Monday, with a credit line of up to $2 billion aimed at "stabilizing" Argentina's economy coming into effect. This bilateral currency swap agreement, announced by U.S. Treasury Secretary Scott Bensons in late September, had not been finalized until Monday, when it was officially announced by the Argentine Central Bank.

This agreement is an important component of a package of measures by the Trump administration aimed at salvaging Argentina's economy and its struggling peso. Currently, President Milei is facing a difficult mid-term legislative election, with the economic situation remaining turbulent.

The Argentine Central Bank stated in its statement that this currency swap agreement aims to "help Argentina achieve macroeconomic stability, particularly focusing on maintaining price stability and promoting sustainable economic growth."

In an interview aired on Monday, Milei explained that the currency swap agreement functions like a credit line, "activated only when needed."

He added: "We have a $2 billion credit line, while the U.S. gets an equivalent peso credit." If Argentina is unable to access the capital market due to persistently high country risk, "we will use this swap agreement to pay off our 2026 debt."

Aside from the currency swap agreement, the U.S. Treasury also announced last Wednesday that it has been working with private institutions, including commercial banks and sovereign wealth funds, over the past few weeks to prepare another $2 billion aid program to help Argentina repay its debts.

The currency swap agreement officially announced on Monday failed to alleviate the pressure on the Argentine currency. The peso exchange rate fell to 1,495 pesos per dollar, depreciating 1.3% from Friday and slightly exceeding the predetermined fluctuation range. Meanwhile, the main index of the Buenos Aires Stock Exchange, the Merval index, also fell by about 1% after initially showing a positive reaction. (Translated by Liu Zhuo)

Original article: https://www.toutiao.com/article/7563963294424416808/

Statement: The article represents the views of the author. Please express your opinion by clicking the [up/down] buttons below.