(Bloomberg) -- Argentina’s central bank is restricting access to dollars at the official exchange rate until President Javier Milei’s administration announces the first measures of a promised shock-therapy program aimed at eradicating inflation. 

The monetary authority said Monday morning that the country’s official currency market, where pesos remain greatly overvalued, would operate with limited transactions to give Milei’s team time to comply with administrative procedures and implement its own policy. Investors anticipate a large currency devaluation in the next few days.

Economy Minister Luis Caputo will unveil his first measures Tuesday as Milei prepares drastic spending cuts, chief spokesman Manuel Adorni said from the presidential palace, without providing a specific time for the announcement. Adorni intends to hold daily press conferences at 9 a.m. local time.  

Dollar bonds due in 2030, which trade at deeply distressed levels, slipped less than a cent while the benchmark stock index, to which foreign investors have little access because of currency controls, rose as much as 4.2% before paring gains.  

Commercial banks in Argentina opened at 10 a.m. Monday as scheduled, amid expectations that the peso’s official exchange rate will be devalued by about 44% in the coming days. Currently, one dollar is worth 385 pesos at the official rate, compared with nearly 1,000 pesos in parallel markets.   

Television cameras showed Caputo entering the Economy Ministry to meet with his officials. And central bank chief Santiago Bausili was working Monday morning on the next policy moves with other members of his team who haven’t been announced yet, according to two people with direct knowledge of the meeting taking place at the monetary authority’s headquarters. 

Among them were: Veronica Holub, who worked at the Finance Secretariat of Mauricio Macri’s government; Vladimir Werning, another former official at Macri’s administration and a managing director at local brokerage AR Partners; and Alejandro Lew, a former chief financial officer at YPF. The people who provided their names asked for anonymity because the information isn’t public yet.

In his Sunday inauguration speech, Milei warned Argentines that his first months in office will be challenging as he battles inflation of more than 140% a year. He pledged to slash public spending to narrow a large fiscal deficit that has been financed by the central bank — through money printing that fuels inflation. 

“No government has inherited a worse situation than what we’re receiving,” Milei said Sunday. “There’s no other alternative to the adjustment, and there’s no alternative to the shock.”

While Milei’s language was encouraging for investors, the change in tack will be put to the test throughout the next couple of months, said Andrew Stanners, an investment director at Abrdn. 

“How long you can carry investors and most importantly the electorate with you will be key,” he said. “Can he get legislation passed? Will social pressures moderate some of the much need fiscal austerity? The market will certainly start to focus on this as the year progresses.” 

(Updates with asset prices in fourth paragraph and investor in 11th paragraph.)

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