The Central Bank finds itself with less margin to lower the rate

The central bank of Argentina found in the last week a lower margin for lower your policy rate, stopping the trend observed since October.

At a time when external turbulence led to the weakening of emerging market currencies, the Argentine peso was no exception, falling yesterday to its lowest level since early October. The waiting that the peso will continue to depreciate makes instruments in local currency less attractive and constrains the BCRA pay higher yields.

The magnitude of the rate cuts was reduced last week, until today for the first time in the downtrend of the past 30 days. Leliq's 7-day interest rate, placed on the market daily to control the amount, was increased for the first time since November 1, from 61.237% to 61.248% on Monday.

The central bank of Argentina will badyze the elimination of the 60% threshold of December 3 rateas reported by Bloomberg News on November 16th. However, the greatest turbulence on the foreign exchange market could move it away from this goal.