BUENOS AIRES, Nov 16 (Reuters) - Argentina’s central bank could eliminate its benchmark interest rate floor as soon as Dec. 3 if it sees inflation expectations dip for two months in a row, two sources at the central bank said on Friday.
The bank had previously said it would keep its benchmark rate at 60 percent until December but had not set a date or terms for adjusting the rate, currently the highest in the world.
The sources said the central bank would eliminate the rate floor if economists lowered their inflation expectations in this month’s central bank poll.
Argentina’s official statistics agency reported a decline in the country’s inflation rate in October. Argentina posted a 5.4 percent inflation last month compared to 6.5 percent inflation rate posted in September.
The latest central bank poll predicts inflation could reach 47.5 percent by the end of the year.
The central bank sources, speaking at a briefing attended by Reuters and Bloomberg, also said details of an expanded currency swap agreement with China would be announced at the Group of 20 summit at the end of the month.
Argentina has implemented a tight monetary policy since a run on the peso currency earlier this year forced Argentina to increase its policy rate and look for outside sources of financing, including a $56.3 billion financing deal from the International Monetary Fund, the largest in the Fund’s history. (Reporting by Scott Squires and Gabriel Burin; Editing by Ross Colvin and Sandra Maler)