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Argentina Interest Rate

Argentina Interest Rate

7-Day LELIQ Rate in Argentina

Throughout 2013-2022, Argentina's central bank policy rates saw dramatic changes in response to rampant inflation and economic instability. The rates were frequently adjusted upwards, particularly post-2018, as part of attempts to curb soaring inflation and stabilize the peso. By 2022, Argentina had some of the highest policy rates globally, reflecting persistent inflationary pressures and economic challenges. These high rates aimed to control inflation but also posed challenges for economic growth and access to credit.

The 7-Day LELIQ Rate ended 2022 at 75%, up from the 38% end-2021 value and significantly higher than the reading of 15.05% a decade earlier. For more interest rate information, visit our dedicated page.

Argentina Interest Rate Chart

Note: This chart displays Policy Interest Rate (%) for Argentina from 2017 to 2016.
Source: Central Bank of Argentina.

Argentina Interest Rate Data

2018 2019 2020 2021 2022
1-Day Reverse Repo Rate (%, eop) 59.25 55.00 38.00 38.00 75.00
Central Bank Badlar Rate (%, eop) 48.25 39.44 34.25 34.19 68.81

Central Bank delivers sizable rate cut in March

At its 11 March meeting, the Central Bank of Argentina (BCRA) decided to cut the 1-day reverse repo rate to 80.00% from 100.00%. Moreover, the Bank eliminated the minimum fixed-term deposit rate.

These decisions reflect the Central Bank's commitment to navigating economic normalization, enhancing monetary stability and fostering investor confidence. Following initial price adjustments in December 2023, there has been a significant slowdown in month-on-month inflation, while year-on-year inflation is still affected by sizable statistical carryovers. Retail inflation trends indicate the reduced pass-through effect of exchange rate fluctuations compared to past experience. Meanwhile, addressing fiscal deficit monetization has translated into a reduction in monetary emission in real terms and a consequent improvement in the Central Bank’s balance sheet. A recovery in depleted net reserves was an additional driver behind the decision to cut rates.

The Bank did not give explicit forward guidance in its press release. However, it said it would continue to focus on managing inflation, enhancing monetary stability and fostering confidence through transparent policy measures. Most of our panelists expect the BCRA to cut the one-day reverse repo rate further this year.

Commenting on the outlook, economists at the EIU stated: “We expect that the BCRA will keep the interest rate negative in real terms in 2024 to shrink the monetary base further. With the monetary base falling to more normal levels, real interest rates will turn positive from 2025, which will support the authorities' efforts to sustain disinflation. Mr Milei made the closure of the BCRA and the dollarisation of Argentina's economy a major plank of his proposed free-market reforms, but our forecasts do not incorporate these extreme changes.”

Consensus Forecasts and Projections for the next ten years

How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Argentine interest rate projections for the next ten years from a panel of 16 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable interest rate forecast available for Argentine interest rate.

Download one of our sample reports to visualize what a Consensus Forecast is and see our Argentine interest rate projections.

Want to get access to the full dataset of Argentine interest rate forecasts? Send an email to info@focus-economics.com.

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