(Reuters) – The U.S. Treasury bought Argentine pesos in the spot and Blue Chip Swap markets on Thursday and continues to monitor all markets, Treasury Secretary Scott Bessent said on Friday.
“The Treasury is monitoring all markets and we have the ability to act with flexibility and force to stabilize Argentina,” he said in a post on X.
It was the first announcement of participation in the “blue chip” market, after Bessent previously spoke of buying pesos in the spot market. The support promised by the United States also includes a $20 billion swap with the Argentine central bank and the operation of a $20 billion credit line to invest in the South American country’s sovereign debt.
“We believe support from the U.S. Treasury is helping to stabilize markets,” Nigel Chalk, deputy director of the Western Hemisphere Department at the International Monetary Fund, said at a news conference.
“IMF staff have dedicated many hours and have been deeply engaged with both Argentina and the US Treasury throughout this process,” he added.
He did not respond to a question about whether the fund would prefer the peso, which trades in a band, to float freely.
The official peso weakened 3.4% on Friday to 1,450 per dollar, not far from the record low of 1,474.50 reached before Bessent first announced US support.
One-month non-deliverable forward contracts in pesos set the currency’s price at 1,446, after rising as high as 1,541 earlier this month. Three-month forwards see the peso close to 1,690 per dollar, according to LSEG data.
The US Treasury has not revealed how much it has spent on purchasing pesos or whether it will do so according to a schedule.
(Reporting by Susan Heavey in Washington, Maiya Keidan in Toronto and Rodrigo Campos in New York; Editing by Doina Chiacu and Matthew Lewis)