Milei Prepares Central Bank Charter Reform to Undo 2012 Changes

President Javier Milei is preparing a significant reform of the Central Bank of Argentina's Organic Charter, aiming to reverse changes implemented during the Kirchner era in 2012. This initiative signals a shift from Milei's past proposals to "dynamite" the Central Bank and his past characterization of the peso as "excrement." Now, the focus in the Casa Rosada is on redefining the bank's role to prioritize the defense of the currency's value.

The project is taking shape, with Milei confirming discussions with key economic officials, including Economy Minister Luis Caputo, Central Bank President Santiago Bausili, and Minister of Deregulation and State Transformation Federico Sturzenegger. Milei specifically targeted Article 3 of the current Charter, which outlines the Central Bank's objectives, calling its wording "abhorrent." He expressed a desire to remove what he termed "the garbage" introduced by Mercedes Marcó del Pont, who led the bank during the 2012 reform.

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It is abhorrent.

Before the 2012 modification, the Central Bank's core mission was to preserve the currency's value. The reform enacted during Cristina Kirchner's second term broadened this mandate, incorporating objectives such as promoting monetary and financial stability, employment, and economic development with social equity. This broader mandate, according to Milei, has served as a guiding principle for the bank's other functions.

Milei contends that the 2012 amendment excessively expanded the Central Bank's capacity to finance the Treasury, thereby undermining its independence and contributing to subsequent inflationary pressures. The proposed reform seeks to reverse this trend by institutionally strengthening the Central Bank and refocusing its mandate squarely on maintaining currency value, while limiting its use as a source of government funding. Milei had previously indicated his intention to revert to the pre-2012 framework, arguing that the previous charter allowed for excessive money printing, potentially leading to hyperinflation.

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The crude Marcó del Pont assigned five objectives to an economic policy instrument. If one reads the current Organic Charter, money can be issued for any reason. That's how we were, they left us with hyperinflation planted.