Luis Caputo freezes the dollar, cuts issuance, and extends the currency controls until October to support Javier Milei's plan.

In the countdown to the elections, Luis Caputo outlined his new economic roadmap : keep the dollar under control, minimize the issuance of pesos, and pause the purchase of reserves, even if that means cooling credit, slowing activity, and tightening the payment chain.

The plan was confirmed by Economy Minister Luis Caputo this week, when he announced that the Treasury will suspend foreign currency purchases from the Central Bank until October , a maneuver that had been putting pressure on the exchange rate through so-called "block trades." The strategy seeks to avoid a currency run in the middle of the campaign, even at the cost of postponing the accumulation of reserves that are key to maintaining debt payments.

The official argument is simple: if there are no more pesos, there is no inflation . This was explained by Finance Secretary Pablo Quirno in a live broadcast, where he stated that "in a market where the quantity of money is controlled, the interest rate floats like the dollar." In this model, the price of credit skyrockets when pesos are scarce. And that is precisely what is happening now: rates of up to 80% nominal annual, which affect both consumption and production.

Monetary tightening is already beginning to show its effects. The reduced availability of money, combined with rising interest rates, is making loans more expensive, restricting financing, and threatening to skyrocket default rates . According to a banker, the handling of the Treasury Bond issue (LEFI) was imprudent, and the authorities are unaware of how the financial system's liquidity is actually managed.

To further tighten the monetary controls, the Central Bank raised bank reserve requirements, forcing institutions to immobilize half of their funds . This further reduced the supply of pesos in circulation and generated distortions in market rates. Some top-tier companies paid rates as high as 130% nominal annual interest to finance themselves over a weekend. In the medium term, they warn, this level is unsustainable.

For economist Carlos Melconian , the government's chosen strategy " has a cost to credit and economic activity ," and he emphasized that monetary issuance has not ended, as factors such as debt non-renewal and private sector loans are still putting pressure on the monetary base. " With these rates, there won't be any credit ," he stated.

EcoGo's economist, Sebastián Menescaldi, warned that financial conditions will remain restrictive at least until the elections, and that the government plans to absorb any pesos it fails to place. " Caputo has already said that the Anker Point is no longer valid. Any surplus will be sterilized ," he stated.

Analysts agree that the real objective is to avoid a spike in the exchange rate in the midst of the campaign. “ The increase in reserve requirements is unpleasant, but it's a response to the fear that the dollar will skyrocket ,” one trader suggested. He added: “They're forcing banks to hand over their dollars to maintain calm.”

With this strategy, the ruling party aims to reach October with a stable dollar, low inflation, and no financial shocks. The cost, experts warn, can be measured in falling activity, increased defaults, and an increasingly strained economy.