Argentina’s central bank chief, Santiago Bausili, delivered a clear message to markets and citizens on Wednesday, August 19, 2026: the era of monetary expansion is over, and the fight against inflation remains the top priority. Speaking at the FIEL Premium Meeting, an annual economic forum, Bausili provided a detailed roadmap for the coming months.
Inflation: A Cautious Optimism
Bausili said that high-frequency price data for the first two weeks of August is “auspicious” and that the monthly inflation figure will likely be below the 1.9% recorded in June. For context, Argentina’s national statistics agency (INDEC) reported July inflation at 2.1%, driven by seasonal factors such as winter school holidays.
“We continue to see a reduction in inflation; the analysts publishing high-frequency data for August are quite optimistic, it seems we will have a rate lower than July, which had transitory factors, but also probably lower than June,” Bausili stated.
Private consulting firms echo this outlook: Analytica projects 1.8%, LCG sees a slowdown in food and beverage prices (with a 0.3% drop in the second week), and EconViews estimates 1.9%. The central bank’s own REM (Market Expectations Survey) places the median at 1.8%.
Looking further ahead, Bausili noted that market expectations remain anchored: around 30% inflation for 2026 and 20% for 2027. He also highlighted that core inflation has already fallen to levels comparable to 2017.
Projected August Inflation (Private Estimates)
| Firm | Projection |
|---|---|
| Analytica | 1.8% |
| LCG | Deceleration in food |
| EconViews | 1.9% |
| REM (BCRA median) | 1.8% |
Monetary Policy: No Room for Stimulus
Bausili was unambiguous: “There should be no expectation that the Central Bank will stimulate economic activity through monetary policy.” Instead, the institution will maintain a “contractionary bias” until inflation converges with international levels.
This stance rules out any peso injection to boost growth, even though Bausili acknowledged that the economy is expanding at a “relatively moderate” pace. Official projections for 2026 growth stand at around 2%, well below the 3.5% originally set in the national budget.
The official justified the strategy as necessary to keep the exchange rate stable and consolidate disinflation. In recent weeks, system liquidity has become scarce, pushing short-term interest rates higher—the overnight repo (caución) reached nearly 30%.
Dollar-Denominated Credits: Flexibility with Caution
Bausili also addressed the recent BCRA Communication “A” 8467, which allows banks to lend dollars to non-exporting companies up to 15% of their foreign-currency deposits.
The central bank chief was measured: “What do we anticipate? A boom in dollar credits for non-exporters? No, not at all.” However, he noted the measure could benefit sectors such as real estate development and SMEs with foreign income.
He emphasized that safeguards were put in place to avoid the currency mismatches that led to the 2002 crisis: banks must analyze debtors’ cash flows and apply an additional capital factor of 1.25 for large exposures.
Reserves and Exchange Rate: Slower Pace of Purchases
On the foreign exchange front, Bausili confirmed the central bank has no plans to abandon its reserve accumulation program, though the pace has slowed. In August so far, daily purchases average about US$31 million, compared to US$103 million in July. Total purchases for 2026 exceed US$13 billion.
The wholesale exchange rate closed on Wednesday at ARS 1,497.50 per dollar, just below the psychological threshold of 1,500. The official retail rate at Banco Nación stood at ARS 1,515 for selling. Argentina’s country risk index rose to 512 basis points, the highest since late May.
Economic Activity: Moderate but More Sustainable
Bausili admitted that the economy is growing “relatively moderately,” but defended the quality of that growth: “We are seeing an expansion led by the export sector, within a framework of fiscal and monetary equilibrium, which makes it more sustainable.”
He also highlighted that, unlike expectations a year ago, Argentina will post a current account surplus in 2026, which helps anchor exchange rate expectations.
Regarding interest rates, Bausili said the priority is to keep them stable, and that money demand will recover as activity and credit improve.
International Context
Bausili noted global headwinds: weaker activity among trading partners could affect exports, while higher energy prices (Brent crude above US$91) may fuel imported inflation. However, he insisted that Argentina’s economy is better prepared than in past episodes to absorb such shocks.
In summary, Bausili’s message reinforces the official line: the adjustment continues, disinflation is gradual, and no monetary stimulus is on the horizon. The bet is that growth will be sustained by the private sector and structural reforms, with patience as the key ingredient.
Sources: Infobae, Ámbito Financiero, La Nación, La Voz del Interior