(Reuters) -Argentina’s central bank on Tuesday raised its reserve requirements for banks to a level analysts said could risk slowing the economy, a move analysts say aims to soothe markets as the government of President Javier Milei is rocked by corruption allegations ahead of key legislative elections.

Reserve requirements are a percentage of funds that banks hold in reserve to ensure they can meet liabilities in case of sudden withdrawals.

The 3.5% increase – the third increase in recent weeks – is set to come into force on September 1, affecting a range of existing reserve requirement rates that average around 45%.

Analysts warned the level is fast approaching an unusual level of 50% which could slow hoped-for recovery in economic growth.

The measure will allow banks to integrate th

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