2022 Objectives and Plans Report

The BCRA has approved the Objectives and Plans for 2022. They are concerned with monetary, financial, lending and foreign exchange policies, and are published as set out in Section 42 of the BCRA’s Charter.

The BCRA shall endeavor to take the following measures in furtherance of its monetary, foreign exchange, financial and lending policies.

Monetary policy:

- Manage liquidity to prevent any imbalances that may directly or indirectly affect the disinflation process, allowing the real growth in the monetary base to accompany a higher demand of real stocks derived from economic expansion and the strengthening of the labor market.

- Set the path of the policy interest rate to obtain positive real returns on investments in domestic currency, and preserve monetary and foreign exchange stability.

- Contribute to the development of the capital market and safeguard financial balance.

- Adjust minimum reserve requirements to strengthen the channel of monetary policy transmission.

Foreign exchange policy:

- Preserve external competitiveness, gradually keeping the rate of crawl at the pace of the inflation rate within the framework of the current managed floating scheme.

- Strengthen the position of international reserves through an accumulation of external surplus reflected on the forex market.

- Prudently manage forex regulations in order to adjust them to the current needs, ensuring monetary and foreign exchange stability. As long as macroeconomic conditions so allow, macroprudential regulations will be relaxed in the medium and long term so that they are consistent with dynamic capital flows channeled to the real economy.

Lending policy:

- Encourage financial intermediation to meet finance needs for the development of consumption, productive investment, and technological change.

- Conduct an active and dynamic lending policy that may adjust to the current needs.

- Promote growth in lending in pesos to the private sector in terms of the gross domestic product (GDP).

Financial policy:

- Foster adequate levels of liquidity and solvency at financial institutions.

- Implement micro- and macroprudential policy actions aimed at financial stability in line with international best practices in regulatory matters.

- Strengthen measures to boost lending to micro, small- and medium-sized enterprises (MSMEs) and to the sectors that were most affected by the pandemic. Also, continue taking measures that may serve to scale up Argentina’s productive investment, neglecting neither the need of resources of the sectors under reactivation nor households’ needs of consumption and investment.

- Encourage “payments by transfer”—modern, low-cost and electronic transactions that yield efficiency gains for both stores and consumers, while fostering financial inclusion. The promotion of e-checks and electronic credit invoices will enable their users to obtain financing under better conditions across the territory.

- Cause technological innovation in the financial system to go hand in hand with new financial service providers within a prudential framework of protection, transparency and security for users. - Broaden the scope of federal financial education, designing and developing education programs, and reaching out to more and more people—the most vulnerable segments first—by way of new agreements.

- Continue conducting actions to improve cyber resilience and cyber security at financial institutions, financial market infrastructures (FMIs), payment service providers (PSP) and other players of the financial system, in a context of a higher supply of digital services supported by advanced technology, and their increasing use by the population.

- Assess the development and implications of cryptoassets to the system and users of financial services, keeping an eye on them in other jurisdictions and international organizations.

- Carry out actions regarding sustainable finance within the framework of international and local commitments, addressing related risks and opportunities.

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December 30, 2021.