- Central Bank of Argentina
The Central Bank of Argentina ( _es. Banco Central de la República Argentina, BCRA) is the
central bankof Argentina. [es icon en icon [http://www.bcra.gov.ar/ Banco Central de la República Argentina] . Official website.]
Founded in by six Acts of Congress enacted on
28 May 1935, the bank replaced Argentina's Currency board, which had been in operation since 1899. Its current president is Martín Redrado.
During the years of the Convertibility Law, which established a 1:1
fixed exchange ratebetween the Argentine pesoand the United States dollar, the BCRA was mainly in charge of keeping foreign currency reserves in synch with the money base.
Since the repeal of the Convertibility Law, the
devaluationand depreciation of the peso and the end of the economic crisis, its role has been the accumulation of reserves in order to gain a measure of control of the exchange rate. The BCRA buys dollars from the market to neutralize the large surplus of the foreign trade balance and keep the exchange rate at the level desired by the government, currently around 3.1 pesos per dollar, considered internationally competitive for exports and useful to encourage import substitution(see Foreign trade of Argentina).
Near the end of 2005, President
Néstor Kirchnervowed to pay the Argentine public debt with the International Monetary Fundin a single, anticipated disbursement. The payment was effected on 3 January 2006, employing about 9,500 million USD from the BCRA's reserves. This decreased the amount of reserves by one third, but did not have harmful side effects save a slight increase in the dollar-peso exchange rate.
The BCRA continues to intervene in the exchange market, usually buying dollars, though occasionally selling small amounts (for example, reacting to rumours of a possible increase of the
Federal Reserve's reference rate, which caused a minor spike in the dollar's value). Its reserves reached more than 28,000 million USD in September 2006, recovering the levels prior to the IMF payment, and rose to 32,000 million at the closing of the year. The exchange rate experienced a gradual increase prompted by the BCRA's market intervention as a buyer, reaching 3.12 pesos per dollar, and then decreased slightly again. [La Nación, 17 June 2006. [http://www.lanacion.com.ar/815472 Las reservas llegan a US$ 25.000 millones] .] [La Nación, 27 September 2006. [http://www.lanacion.com.ar/844220 El Central recuperó las reservas del pago al Fondo Monetario] .] In its October 2006 issue, the influential Global Finance magazine gave Martín Redrado, head of the Central Bank, a D grade in its survey of global central bankers. The magazine holds that Redrado "missed the opportunity to act to curb inflation when the economy was expanding at its fastest ... with inflation expected to reach 12% in 2006, up from 7.7% in 2005 and 4.4% in 2004." Inflation for 2006 eventually amounted to 9.8%, helped by price controls, though the public's perception of it was higher due to the composition of the sample used to measure it. [La Nación, 5 January 2007. [http://www.lanacion.com.ar/872817 La gente percibe mayor inflación] .] The BCRA obtained exceptionally high returns on investment funded by its reserves, for a total of 1.4 billion USD (a yearly rate of 5.7%) in 2006. [La Nación, 7 January 2007. [http://www.lanacion.com.ar/873441 El BCRA obtuvo un rendimiento récord de las reservas internacionales] .]
As of July 2, 2008, the Central Bank of Argentina had accumulated reserves of US$47.6 billion. ["Clarín". 7 July 2008.]
Economy of Argentina
* en [http://www.bcra.gov.ar/ Central Bank of Argentina Official site]
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