Argentine FX band cap rises to $1,950

The Argentine central bank currency band will adjust its upper limit toward $1,950.97 by the end of October. On 10 September, Indec reported August consumer inflation of 1.7%, which determines the daily indexation of the floating corridor with a two-month lag. The ceiling will rise from $1,919.40 at the end of September, an increase of $31.57 reflecting the August print, after July inflation was 2.1%.

The wholesale exchange rate stood at $1,509 on 11 September. That left a gap of $385.30 below the active band ceiling of $1,894.30. On Wednesday 9 September, the wholesale dollar reached a nominal year-to-date peak of $1,515 before paring gains. In 2026 to date, the official wholesale peso has weakened by $52 or 3.8%, trailing year-to-date inflation of 21.3%.

The currency band system began in mid-April of last year with a floor of $1,000 and a ceiling of $1,400, which adjusted at 1% per month through 31 December before switching to inflation indexation. The central bank intervenes directly by buying foreign currency at the floor and selling at the ceiling. The ceiling intervention occurred four times during the previous year's electoral period.

Financial firm IEB reported that the wholesale currency maintains low volatility, supported by strong inflows. The central bank estimated US$4,400 million remaining in corporate bond settlements, alongside new placements from Tecpetrol, YPF, and San Juan. Additionally, the Rosario Stock Exchange projected agricultural export revenues of US$12,160 million between September and December.

Andrés Reschini, partner at F2 Soluciones Financieras, noted that the wholesale rate sits 25% below the upper band limit, citing structural supply improvements from the energy sector. However, Reschini pointed out that net reserves remain fragile and future presidential elections could increase dollar demand. The central bank's Market Expectations Survey projects the wholesale exchange rate will close the year between $1,626 and $1,630, representing an annual devaluation of 12.6%.