Milei Defies Investor Calls to Build Reserves: Shock Therapy

Despite a chorus of calls from investors, Argentine President Javier Milei and his advisers are hesitant to rapidly build reserves, let the peso float and relax currency controls.

The government’s landslide victory in the mid-term elections last month has given Milei a window of opportunity to advance a new foreign-exchange framework, according to Argentine investors. That could include reserve purchases, greater flexibility and a weaker exchange rate to help balance Argentina’s external accounts.

But Economy Minister Luis Caputo, Central Bank President Santiago Bausili and others are resisting the changes after the government’s peso intervention ahead of the vote. Factors ...