BUENOS AIRES — Argentina’s central bank lowered the benchmark interest rate to 60% annually from 70%, the monetary policy entity said, the second rate cut this month as the government grows increasingly confident about tamping down inflation.
The rate cut comes amid growing central bank bullishness over bringing down the monthly inflation rate faster than analysts expect, which is key for the country’s economic recovery with prices rising at nearly 300% annually.
The news confirms a Reuters report earlier citing three local financial sector sources, who said the monetary policy setting body had advised traders of the 10-point cut in a memo.
Argentina’s central bank two weeks ago cut the benchmark interest rate by another 10 percentage points
citing a “pronounced” slowdown in inflation amid a tough and painful austerity drive under new libertarian President Javier Milei.
Milei’s tight fiscal policies have boosted the mood of investors in Argentina, propelling shares, bonds and the peso currency, but poverty levels are rising along with an economic recession, as activity, production and consumption slide.
