Luis Caputo Replaces Sturzenegger as Argentina Cenbank President

(Bloomberg) -- Argentine Finance Minister Luis Caputo will become the president of the country’s central bank after Federico Sturzenegger resigned, according to a statement Thursday evening from the ministry.

Nicolas Dujovne will lead a united Ministry of Finance and Treasury, the government said. Sturzeneger’s departure was followed by a slew of resignations among the bank’s senior staff.

The change at the central bank’s helm comes after the Argentine peso tumbled 6.1 percent Thursday to a new all-time low of 27.7 per dollar. Investor concerns mounted that monetary policy was becoming even more inconsistent.

Sturzenegger said in on Twitter Thursday evening his credibility “deteriorated” in the past few months because of various reasons.

Sturzenegger, an MIT-trained economist, oversaw the central bank during President Mauricio Macri’s first two years in office. He became the chief policymaker in December 2015 as Macri attempted to unwind a decade of economic mismanagement and reintegrate Argentina into the global economy. Sturzenegger, 52, moved quickly to dismantle currency controls and make the peso a free-floating currency, helping to fulfill Macri’s campaign promises to open up the economy and attract investment.

More recently, the Sturzenegger sought to arrest a decline in the currency last month by raising interest rates to the highest in the world at 40 percent, while the government negotiated a $50 billion credit line with the International Monetary Fund. Sturzenegger said last week that the central bank would only intervene in the market in "disruptive situations" and that the currency would operate with normality.

In a separate statement, the central bank said Mariano Flores Vidal, general manager, Demian Reidel, second vice president and Andres Neumeyer, chief economist, also resigned from the bank.

©2018 Bloomberg L.P.

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