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Argentina asks IMF for early release of standby funds
[BUENOS AIRES] Argentina is asking the International Monetary Fund for early release of funds from the country's US$50 billion standby financing deal, President Mauricio Macri said in a televised address on Wednesday, a move aimed at calming turbulent markets.
The country's currency has weakened 40.79 per cent in 2018. Investors are concerned that with high inflation, a weak economy and fallout from a global selloff in emerging markets, Argentina may have problems meeting its dollar debt obligation in 2019.
"We have agreed with the International Monetary Fund to advance all the necessary funds to guarantee compliance with the financial program next year," Mr Macri said. "This decision aims to eliminate any uncertainty."
Argentina's central bank sold a total of US$200 million of its reserves in two currency auctions on Tuesday after the peso hit new lows. The currency weakened to a record close of US31.50 per dollar after touching an all-time low of US31.60 to the greenback earlier in the day.
Central bank shows it has sold US$12.881 billion in the foreign exchange market this year as monetary policymakers try to stabilize the currency. The government says it expects the country's economy to contract 1 per cent in 2018 but grow by at least 1.5 per cent next year.