This Thursday the Board of Directors of the Central Bank (BCRA) decided to raise the monetary policy rate by 1,000 basis points and, thus, the annual interest rate paid by 30-day fixed terms rose to 91% for placements of up to $30 million. In this way, the annual nominal interest rate of the Liquidity Letters (leliq) at 28 days increased to 91% (141% in effective annual terms, TEA).

“Simultaneously and in pursuit of promoting savings in pesos, the BCRA raised the minimum guaranteed interest rate and tripled the taxable amount on fixed terms of human persons, establishing the new floor at 91% per year for deposits from 30 days to 30 million pesos (140.5% of TEA)”, detailed the monetary authority in a statement. For the rest of the time deposits of the private sector, the minimum guaranteed rate is established at 85.5% (128.5% of TEA).

He central bank assured that “The monetary authority’s decision is based on the objective of tending towards positive real returns on investments in local currency and acting to preserve monetary and financial stability.”

In this sense, the entity that presides Miguel Pesce assured that “It will continue to monitor the evolution of the general price level, the dynamics of the financial and exchange markets, and the monetary aggregates for the purpose of calibrating its rate policy.” The rate hike comes after the government made public its decision to stop the increase in parallel dollar prices, amid the shortage of foreign currency due to the impact of the drought.

According to projections from the Ministry of Agriculture, Livestock and Fisheries, grain production would fall 30.9% this season compared to the 2021/22 cycle, which represents a drop in income of US$ 16.990 million compared to the income of last year’s harvest.