US Treasury Negotiates $20 Billion Swap Line with Argentina

The United States is currently negotiating a $20 billion currency swap line with Argentina's central bank, as announced by U.S. Treasury Secretary Scott Bessent. In a statement on X, Bessent emphasized the U.S. Treasury's readiness to purchase Argentina's U.S. dollar-denominated bonds and to provide significant standby credit through the Exchange Stabilization Fund.

Bessent highlighted Argentina's progress under President Javier Milei, noting strides toward stabilization through fiscal consolidation and liberalization of prices and regulations. He expressed confidence in Argentina's ability to counter market destabilization efforts, including those driven by political motives.

President Milei expressed gratitude for the U.S. support, underscoring the strong bilateral ties and shared values between the two nations. Following these developments, Argentina's 2030 bond rose over 4 cents to 75.36 cents on the dollar, and the Global X Argentina ETF surged more than 4%, with local bank stocks experiencing double-digit gains.

The U.S. support comes as Argentina faces challenging legislative elections on October 26, with half the Chamber of Deputies and one-third of Senate seats up for grabs. Milei's La Libertad Avanza party recently suffered a significant defeat in Buenos Aires provincial elections, securing only 33.8% compared to the Peronist opposition's 47%.

Additionally, the World Bank announced plans to accelerate its support for Argentina, promising up to $4 billion in funding over the coming months. This support will combine public-sector financing with private investment, focusing on key areas such as mining, critical minerals, tourism, energy access, and strengthening supply chains.