BUENOS AIRES - Argentina opened discussions with the International Monetary Fund on Tuesday about obtaining a "line of financial support," President Mauricio Macri announced amid a bout of market turbulence in Latin America's third largest economy.
Argentina is turning to the IMF for financing as the peso is buffeted by market turbulence
In a televised speech, Macri said Argentina's economy had enjoyed favorable conditions during the first two years of his presidency.
"But this context is changing. We are among the countries of the world that are most dependent on foreign financing, a product of the enormous public spending we inherited and are putting in order," he said, explaining the decision to open talks with the IMF.
Macri said he had his first conversation with IMF managing director Christine Lagarde, but did not say how big a line of credit Argentina is seeking.
IMF financing would strengthen his "program of growth and development, giving us greater backing to confront this new global scenario and avoid a crisis like those we have had in our history," he said.
The Argentine peso, which dropped 4.61 percent to 23.41 to the dollar in opening trades Tuesday, strengthened slightly after Macri's speech at 23.06.
Argentina's Central Bank on Friday raised its key interest rate to 40 percent after the peso plummeted in value earlier in the week.
Although the bank's actions appeared to have stabilized the currency on Monday, the peso fell sharply again on Tuesday, prompting a sell-off on the Buenos Aires Stock Exchange.
The Central Bank is supposed to revisit the benchmark rate once again later in the day.
In addition to the weak peso, Argentines are struggling with double-digit inflation, which hit 24.8 percent last year. The government last week lowered its target for the fiscal deficit to 2.7 percent from 3.2 percent of GDP.