During our recent visit to Argentina, we engaged with various legal and economic experts to gather insights on the future of the nation's capital controls. Despite differing opinions among these specialists, we identified key events in 2025 that warrant close attention.

The US Federal Reserve announced a second consecutive interest rate cut, reducing the target range by 25 basis points to 4.5% - 4.75%, following a 50 basis point cut in September.

On October 23th, the Bank of Canada announced a 50 basis point rate cut, reducing its target rate from 4.25% to 3.75%. Historically, such significant cuts have been implemented during times of economic crises, like the 2008 financial downturn and the 2020 pandemic, where the central bank sought to stabilize the economy amid severe shocks. Today’s adjustment, however, is a response to recent data indicating a sharper-than-expected slowdown in inflation, aiming to sustain economic momentum in a period of easing policy.

For the first time in over four years, the Federal Reserve has lowered its interest rates, a decision announced by Jerome Powell at the September 18th, 2024 FOMC meeting. The 50-basis-point reduction brings the target range down from 5.25%-5.5% to 4.75%-5%. Powell explained that this adjustment was driven by recent economic data, reflecting the Fed's confidence in the overall health of the U.S. economy.

On September 4th, the Bank of Canada announced its third consecutive interest rate cut, lowering the target rate by 25 basis points to 4.25%.

Since the start of Argentina's new monetary plan, which involves the Central Bank (BCRA) selling dollars from exporters, the FX gap has shrunk from 55% to 42%. Despite this, it hasn't dropped below 40%. The BCRA's strategy has focused on preventing big jumps in the BCS rate rather than aggressively narrowing the gap.