A Candid Assessment in Mendoza
On August 14, 2026, Santiago Bausili, president of the Central Bank of Argentina (BCRA), spoke at the Mendoza Stock Exchange during an event titled 'Transformation, Balance of Management, and Strategic Goals.' He was joined by Governor Alfredo Cornejo and moderated by national deputy Lisandro Nieri. Bausili offered a frank look at the economy, admitting that growth is much slower than desired.
He stated that the economy is growing at around 2% annually, which he described as 'much slower than we would like.' However, he emphasized that the downward trend has been reversed and that growth has resumed since the removal of restrictions in 2024, albeit unevenly across sectors and regions.
The 'Fear' Factor
Bausili highlighted that 'fear' and 'post-traumatic stress' are still dominating decision-making in Argentina. He explained that this excessive caution, while understandable given the country's history, is not justified by the current macroeconomic fundamentals. 'If the fundamentals are solid, the risk of what those fears say is very low, so the premium becomes expensive,' he said. He also noted that Argentines save in dollars, but the banking system does not, and called for channeling that savings into the formal financial system.
Credit Recovery
On the financial system, Bausili confirmed that credit is recovering. 'In the last three months—May, June, and July—all three months showed positive numbers in terms of credit growth, both in pesos and dollars,' he said. Credit had stalled in the second quarter of 2025 ahead of the electoral process, but has since picked up. He noted that the current credit level is low compared to regional peers and historical averages, but it is now growing at a reasonable pace.
He also mentioned that the credit system is about 9.6% of GDP in pesos and 12.5% in dollars, far below other Latin American countries. He predicted that delinquency has peaked and will start to decline, which could further boost lending.
Long-Term Financing Challenge
Bausili identified the lack of long-term savings instruments as a major weakness. 'What is missing is thinking about institutions that have been very weak in the economy, and that is the lack of a sector of tools that channel long-term savings into the financial system,' he said. This creates a structural problem for banks, which take short-term deposits but need to lend long-term. He mentioned pension funds as a potential solution, but noted that the life insurance and retirement industry has faced limitations.
Inflation Outlook
Regarding inflation, which accelerated to 2.1% monthly in July according to INDEC, Bausili attributed the uptick to seasonal factors and tourism, but expressed confidence that the disinflation path will resume. 'We are convinced we will get back on track,' he said, adding that monetary policy remains contractionary and the primary goal is reducing inflation.
He also discussed the impact of rising oil prices since March, but argued that Argentina is now better positioned to absorb external shocks due to stronger fundamentals.
Strategy for the 2027 Elections
One of the most anticipated topics was the 2027 elections. Bausili explained that the government will counter election-related uncertainty with more deregulation and by reminding investors that speculative attacks were costly in 2025. 'It was like paying an insurance premium and it made no sense. So this time, many will not get on board with that situation,' he said. He emphasized that the Central Bank is solid in terms of reserves and that the same tools are available: falling inflation, macroeconomic order, fiscal surplus, and the high cost of fear (which translates into debt and delinquency).
He also recalled the financial adjustment of October 2025, one of the strongest in recent history in terms of interest rates, and noted that since 2002, every time the exchange rate and financial regime was tested, it ended up being exhausted and had to be rewritten—except in October 2025.
New Dollar Credit Rule
Bausili also discussed a recent regulation allowing banks to lend dollars to non-exporting companies. This measure, implemented via a Decree of Necessity and Urgency (DNU), modifies Article 23 of Decree 905/02, permitting banks to lend up to 15% of their dollar deposits to companies that do not generate foreign currency. The goal is to encourage formal savings rather than keeping money 'under the mattress.' The rule requires a guarantor exporter and caps such loans at 15%.
Market data shows that private sector dollar deposits have risen from USD 14.1 billion in December 2023 to USD 40.3 billion currently, while dollar loans have grown from USD 3.7 billion to USD 24.6 billion. The estimated additional lending capacity is about USD 5.8 billion.
Governor Cornejo's Support
Governor Alfredo Cornejo, now an ally of the ruling party, defended the government's economic direction, particularly fiscal order and macro balance. 'The situation has changed for the better,' he said, adding that 'stability must become predictability to generate investments and sustained growth.' He endorsed the proposed reform of the BCRA's charter, which aims to restrict the Central Bank's ability to finance the Treasury and enhance its autonomy. Bausili stressed that 'the country should no longer discuss using the Central Bank to finance fiscal deficits.'
Cornejo also noted remaining challenges, such as converting savings into investment and improving access to credit for SMEs, productive projects, and housing.
Key Data from the Presentation
- 📊 Growth: ~2% annually, 'much slower than we would like'
- 📈 July inflation: 2.1% monthly, with expectations of resuming disinflation
- 🏦 Credit: recovery in May, June, and July, in both pesos and dollars
- 💵 Dollar credit: new rule allows lending up to 15% of deposits to non-exporters
- 🗳️ 2027 elections: strategy is more deregulation and recalling the cost of fear in 2025
- 🏛️ BCRA reform: Cornejo endorsed; aims for greater autonomy and restricting Treasury financing
Sources: Infobae, La Nación, La Voz del Interior, Los Andes. The event was organized by the Mendoza Stock Exchange and included Governor Alfredo Cornejo, Deputy Lisandro Nieri, and local business leaders.