Pressured by the market, the Central Bank raised the rate by 300 points: how much will the fixed terms pay?

After the inflation figure in May and in the middle of investor pressure and tension in the local market, the Central Bank their meeting anticipated board meeting on Thursday, which always takes place in the afternoon, and announced when opening the wheel a new rate hike.

“The Board of Directors of the Central Bank of the Argentine Republic (BCRA) decided today to lift at 300 basis points the annual nominal interest rate of the Liquidity Letters (Leliq) at 28 days, going from 49% to 52%“, expressed the monetary authority in a statement.

“At the same time, the BCRA will maintain the mechanisms by which it ensures that the monetary policy rate hike entirely passed on to depositorsboth for individuals and for companies, through fixed terms with minimum rate and fixed UVA terms “, he clarified.

Fixed retail terms, they now have up to $ 10 million a minimum fee of 53% per annum. For the rest of the fixed-term deposits in the private sector, the guaranteed minimum annual rate is set at 50%.

“The May data confirmed the slowdown in inflation started in April, with a significant drop in the core category. The BCR expects monthly inflation records to continue to gradually decline “the agency said in a statement.

The monetary authority continues its process of gradual normalization of the reference rate and the rest of the interest rate structure of the economy, in order to help preserve financial and exchange rate stability, support product and market growth. employment and reduce inflation, he added.

“Likewise, in an economy like Argentina with a relatively small credit channel, the rate hike acts mainly iencouraging savings in pesos. Its anti-inflationary action. hence it largely passes by contributing to exchange and financial stability, it must be integrated with other economic policy tools to reduce inflationary inertia“says the Center.

“The BCRA will continue to calibrate monetary policy on the basis of the observed and forward-looking evolution of the general price level and will continue to take actions to align its monetary policy with the BCRA Goals and Plans for the year 2022, in which the authorities have set as a goal to set the path of the official interest rate towards positive real returns on investments in local currency. “

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