Argentine Presidential Candidate Daniel Scioli Backs Central Bank’s Currency Controls

BUENOS AIRES -- Argentine ruling party presidential candidate Daniel Scioli defended the central bank's control of the exchange rate Saturday, saying it was necessary to avoid foreign-exchange volatility. Scioli's comments came two days after his main rival said he would allow the peso to float freely and would welcome the resignation of the central bank's chief.

"My vision is that we have to continue managing the exchange rate and preserve currency and financial stability so the development project has continuity," Scioli said on Radio Mitre. "In any civilized country, the central banks intervene in the currency," added the candidate, who has promised gradual change after eight years of leftist government.

Leading opposition candidate Mauricio Macri has vowed to unwind outgoing President Cristina Fernandez's controls on the currency and trade. In some of his most forthright comments on the central bank, Macri branded its President Alejandro Vanoli a "militant" Thursday and said he hoped Vanoli would quit should be elected Argentina's president.

The central bank controls the official exchange rate, but a flourishing black market rate suggests the peso is overvalued. Allowing the peso to float freely would risk a sharp devaluation, Scioli's camp says.

Macri is running second in the presidential race to Scioli, but for now Scioli appears to lack sufficient voter support to secure a first-round win Oct. 25, paving the way for a run-off in November.

(Reporting by Walter Bianchi; Writing by Mitra Taj; Editing by David Holmes)