International Monetary Fund (IMF) logo is seen outside the headquarters building in Washington, U.S., as IMF Managing Director Christine Lagarde meets with Argentine Treasury Minister Nicolas Dujovne September 4, 2018. REUTERS/Yuri Gripas
September 14, 2018
BUENOS AIRES (Reuters) – A $3 billion payment that the IMF had been expected to disburse to Argentina this month under its standby financing deal has been postponed while the government renegotiates the terms of the agreement, an Economy Ministry source said on Friday.
The payment “has been halted until new terms are reached,” said the source, who had asked not to be named for lack of permission to speak to the press about ongoing negotiations with the International Monetary Fund.
The local peso currency has lost more than half its value against the U.S. dollar this year as concerns swirled over the government’s ability to pay its debt obligations next year.
The currency closed almost unchanged at 39.87 to the greenback on Friday, marking a 7.25 percent loss for the week.
President Mauricio Macri signed a $50 billion standby finance deal with the IMF in June, but went back to the Fund to renegotiate terms in order to speed up cash disbursements under the agreement. Talks between government official and IMF staff have been held in Washington and Buenos Aires.
Both sides say they want the new deal inked as soon as possible. Earlier on Friday the central bank said it auctioned $75 million in reserves, out of $200 million offered, at an average price of 39.8463 per dollar. The bank said it will raise reserves requirement by 5 basis points on Sept. 19.
As part of its effort to control inflation and the fall of the peso, the bank is also aiming to reduce market liquidity by reducing the amount of outstanding short term Lebac notes. The bank said on Friday that next week it will offer 150 billion pesos in Lebacs against the 300 billion that will mature during the week.
(Reporting by Gabriel Burin and Jorge Otaola; Writing by Hugh Bronstein; Editing by Chizu Nomiyama and Phil Berlowitz)