development. let me focus on one aspect, which i believe is essential to achieve sustained economic growth : to development of a long - term market in local currency. particularly in the case of economies in transition towards its long - term equilibrium, central banks include on their agenda other specific tasks that their policy actions cannot ignore : the need to increase the depth of the financial system, develop new financial instruments and complete existing markets in local currency becomes a priority. there is a strong consensus about how important this is for the emerging countries. different kinds of factors, at both the macroeconomic and microeconomic levels are noteworthy. among the macro factors, progress in the de - dollarization of the economy and the reduction of vulnerabilities associated with the possibility of sudden stops stand out. this is of special significance because the presence of currency mismatches has been at the root of the most important financial crises ( or has at least contributed to amplify them ). a significant dependence on debt in strong currencies means that countries are more vulnerable to depreciations of their currencies ( which are severely contractive ). also, the development of markets for debt in domestic currency tends to be associated with a better liability management. in fact, the development of a yield curve that serves as the base to develop new products ( like derivatives ), makes it easier to mitigate risks. of the micro factors, it is fundamental to develop a yield curve in domestic currency that reflects the opportunity costs of funding at different maturities, collaborating to achieve more efficient resource allocation. the development of these markets is a more stable source of funding for the financial system. in addition, the countries with deeper domestic markets face a broader variety of policy instrument choices. therefore, the lender of last resort role avoids the limitations observed in a highly dollarized context, for example. likewise, less reliance on external capital flows ( usually at short terms ) allows for more control over the monetary policy. despite the achievements observed during this decade, there is still significant progress to be attained, which is even clearer for latin america. especially as regards the terms of the issues ( so that the change from issuance in hard currencies to soft currencies does not imply excessive currency risk for interest rate risk ) and a larger share for the nominal fixed rate issues ( with the aim of reducing the interest rate risk ). in addition, although the liquidity of the secondary markets for debt has increased in recent years, it remains limited

guido sandleris : the ongoing need for tight monetary policy to fight argentinian inflation speech by mr guido sandleris, governor of the central bank of argentina, at a press conference, buenos aires, 13 june 2019. * * * good afternoon. thank you all for coming. a few minutes ago, the national institute of statistics and censuses ( indec ) released the inflation figure for may. i believe it is a good opportunity to share some thoughts about it, as we did in the last three months. inflation went down in may once again. headline inflation was 3. 1 %, down 0. 3 percentage points against april, whereas core inflation was 3. 2 %, down 0. 6 percentage points. these figures are still very high, though. they are far from an acceptable level. i am convinced that inflation will go on decreasing if we stick to the tight monetary policy we have conducted so far. in fact, we expect june ’ s inflation will be lower than may ’ s figure. the inflation reduction process is slow and, as i have said many times, it is not linear. let me explain why inflation drops slowly despite the fact that we have met our target of zero growth in the monetary base since we launched the scheme more than 8 months ago. first, in argentina, the exchange rate pass - through to prices and indexation are significant, after over a decade of high inflation. that is why the great depreciation in 2018 caused inflation to shoot up, which persisted over time. something similar happened in march 2019, though to a lesser extent. second, most increases in fares and utility rates occurred in the first months of the year, which fueled inflation further. although these factors were identified, the way in which they were combined and fueled by sectorial shocks resulted in a higher than expected inflation rate, which in turn demanded extra effort from monetary policy. inflation will continue falling because the current macroeconomic conditions are finally conducive to this. we have recovered the basic macroeconomic equilibrium : fiscal balance, competitive foreign exchange rate and undistorted relative prices. we will continue conducting a tight monetary policy on these grounds. reaching a one - digit annual inflation rate will take time and effort. perseverance is key to this process. as i have already told you on previous occasions, we must take into consideration the experience of argentina ’ s neighbors that reported high inflation rates for decades. they put their fiscal accounts in order, adopted consistent monetary policies and managed