Banco Central de la República Argentina introduced a currency measure that would keep traders from making quick, same-day returns via foreign currency, in a bid to contain market volatility, Reuters reported, citing a statement by the bank.
The central bank now obligates people who buy foreign currency to hold on to it for at least five days before they could use it to invest in bonds. Previously, bonds could be purchased via foreign currency and then be sold immediately at a favorable exchange rate.
The measure comes after President Mauricio Macri reintroduced capital controls on Sept. 1 to help stem the local currency's decline. These controls limited dollar purchases and required companies to seek central bank approval to sell pesos for foreign-currency purchases or foreign transfers.
Argentine assets, including sovereign bonds, fell sharply Sept. 2.
Fitch Ratings, Moody's and DBRS all downgraded Argentina in late August after the country unilaterally extended the maturity of its short-term debt.
S&P Global Ratings downgraded Argentina's credit rating Aug. 15 further into junk territory, citing the market turmoil caused by Macri's defeat in the Aug. 11 primary elections. On Aug. 29, it downgraded the rating again toward selective default after the unilateral extension of maturities was announced, though it later reversed the decision.
The peso has lost more than a third of its value so far in 2019 after dropping more than 50% in 2018.
