Argentina's Senate voted 46 to 22 on Thursday, 24 September 2026, to rewrite the central bank's founding law, stripping away decades of broader economic mandates in favor of a single mission: protecting the peso's value. The reform marks a sharp break from the bank's charter since 2002, which explicitly included financial stability, job creation, and economic development with social equity among its core responsibilities.
The overhaul eliminates the central bank's ability to lend to the national government, provincial governments, and municipalities. It also removes the bank's power to direct credit toward chosen economic sectors—a tool governments have used to support key industries and small businesses. Two mechanisms that allowed past administrations to draw cash from the bank's reserves, adelantos transitorios (short-term advances) and letras intransferibles (non-tradable IOUs), are scrapped entirely.
President Javier Milei presented the reform on 30 July in a national television address, framing it as the centerpiece of his anti-inflation strategy. "The end of inflation begins," he wrote on social media. The Chamber of Deputies had already passed the bill on 26 August by a vote of 144 to 102, with 9 abstentions. The Senate's version, however, introduced significant changes to the governance structure that forced the bill back to the lower chamber for reconsideration.
Who Bears the Cost
For ordinary Argentines—those who earn wages, save money, or pay rent in pesos—this reform is a long-term bet, not an immediate fix. The law doesn't change prices, rents, or the exchange rate this month. It's a structural commitment to monetary austerity that will reshape what the central bank can do for the next generation.
The reform also eliminates the president's unilateral power to remove bank officials, though the new rules still favor executive control. Under the revised text, the president can now remove the bank's leadership with prior approval of an absolute majority of the Senate—37 of 72 votes. The Chamber of Deputies had originally required a two-thirds supermajority for such removals. Senator Agustín Monteverde of Milei's La Libertad Avanza party confirmed that opposition blocs had agreed to the weaker threshold, which passed 66 to 2, with Peronist support.
The bank can no longer send profits from a weaker peso or higher gold prices to the Treasury as dividends. Those paper gains must now remain in the bank's capital. The explanatory note acknowledges that governments since 2002—including Milei's own administration—have relied on this practice to fund spending. The reform also shields international reserves from seizure by creditors, though it requires the bank to use part of its yearly profit to settle old Treasury debts that remain unpaid.
The IMF Connection
On the same day the Senate voted, Argentina made its first principal repayment under its current IMF program, sending about US$793 million to the Fund on Friday, 25 September 2026. The payment represented SDR 583.3 million—one-twelfth of the SDR 7 billion Argentina drew in March 2022 under an Extended Fund Facility. The IMF's longer-term loans are repaid in twelve half-yearly slices, beginning four and a half years after each drawing.
Argentina now owes the IMF roughly US$58 billion, making it the Fund's largest debtor. The debt spans three separate arrangements: a stand-by loan approved in 2018 under President Mauricio Macri, a refinancing in 2022 under President Alberto Fernández, and a third arrangement agreed in April 2025 under Milei. About US$15.6 billion of that third arrangement has been paid out so far.
The Treasury funded Friday's repayment by drawing on its dollar deposits at the central bank—roughly US$2.23 billion as of 22 September. Analysts say this approach lowers gross reserves by the payment amount but leaves net reserves unchanged. Gross reserves fell to US$48.845 billion on Thursday, 24 September, their lowest level that month. They had dropped US$481 million on Wednesday, partly due to a US$100 million payment to CAF, a Latin American development bank.
An IMF staff team arrived on Monday, 21 September, to conduct the third review of the 2025 programme. The mission is led by Joyce Wong, on her first review as mission chief for Argentina. The team is verifying that the government has met its budget and reserve targets. Economy Minister Luis Caputo said on Monday that the targets were "super cumplidas," or more than met. If the IMF staff agrees and the Executive Board approves, Argentina can draw an additional SDR 636 million, about US$865 million, which the government plans to use to refill the Treasury deposits spent on the repayment.
What Comes Next
The payment schedule ahead is demanding. In early November, Argentina faces an IMF bill of SDR 636 million in interest and charges. On 24 December, a second principal slice of SDR 250 million, about US$340 million, comes due. Then on 9 January 2027, Argentina owes bondholders about US$4.3 billion on Globales and Bonares bonds from its 2020 restructuring. The IMF's own projections put Argentina's total payments at about US$7.7 billion in 2027 and US$9.6 billion in 2028, at current SDR rates.
Opposition senators objected to the central bank reform on two fronts. They warned that a single-minded focus on peso protection would neglect credit availability and economic growth. They also raised concerns about using international reserves as collateral, a move they saw as exposing Argentina's financial cushion to external pressure.
The reform passed despite these objections, reflecting Milei's control of the legislative agenda and the willingness of some opposition lawmakers to support orthodox monetary policy. The vote sends the bill back to the Chamber of Deputies for final approval, where Milei's coalition holds a comfortable majority.
Why This Matters:
Argentina's central bank reform represents a fundamental shift in how the state can use monetary policy to support employment, growth, and social equity. By narrowing the bank's mandate to a single goal—protecting the peso—the government removes tools that past administrations used to steer credit toward small businesses, agricultural producers, and other sectors. The ban on lending to national, provincial, and municipal governments also constrains the state's ability to respond to local economic crises or fund public investment. For workers, savers, and borrowers, this means less institutional support during downturns. The reform is a bet that inflation control alone will eventually deliver prosperity. But it eliminates the central bank's legal obligation to consider jobs and equitable development, making those outcomes dependent on market forces rather than democratic policy choices. Combined with Argentina's massive IMF debt—roughly US$58 billion—and the grueling repayment schedule ahead, the reform locks in a path of monetary austerity for years to come.