Adds further details from bank statement
BUENOS AIRES, Oct 8 (Reuters) – Argentina’s central bank will lower the benchmark Leliq rate to 37%, from the previous level of 38%, the bank said on Thursday, while raising the passive repo rate 3 points to 27%, part of a wider interest rate harmonizing push.
The bank said in a statement the decision would bring the two rates closer together after government efforts to mitigate the economic impacts of the coronavirus crisis saw them diverge earlier this year.
Leliqs, auctioned to local banks in pesos and which set the benchmark rate, doubled in volume in the first seven months of the year in response to the government’s opening of spending taps to counter the impact of COVID-19.
The increase in the repo rate and alignment of the ‘Leliq’ rate with Treasury instruments will boost their effectiveness in influencing short-term rates of the economy, the bank said.
(Reporting by Jorge Otaola; Writing by Adam Jourdan; Editing by Rosalba O’Brien)
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