Physical Address

304 North Cardinal St.
Dorchester Center, MA 02124

the Government, closer to accelerating the devaluation than to lifting the stocks

He Treasury Palace It is the echo chamber of a series of political events, whose nerve endings are anchored in the value of dollar. Apart from the rebellion of the governors who this Tuesday will materialize a new chapterperhaps it is appropriate to reinstall an arid legacy left by the visit of Gita Gopinathnumber two of the IMF.

The organization was clear. He spread a trail of substantial comments with businessmen, union members and officials in the exchange, where there were more questions from the IMF what revelations: The exchange rate is a key variable to normalize accounts and accumulate reserves, not touch.

That is one of the reasons why it is not recommended. dollarize. The Argentine peso is a tool that allows reserves to be added quickly by increasing the price of the dollar (devaluation).



On the sidelines, the diagnosis left by the organization raised the warning: the real exchange rate is already below that recommended by Georgieva & Co.

With a managed devaluation that pedals at a speed of 2% monthly (crawling)the inflation moves to 15% leading to rapid appreciation. This diagnosis even applies to effective exchange rates higher than the official one, such as without the importer (PAIS tax amount of 17.5%) and exporter (80% at the official-20 CCL).

In translation, one might think that, going forward, would slow down the pace of currency purchases by the Central Bank (BCRA)which managed to accumulate more than US$8 billion since the December devaluation.

The market of future dollar seems to support this hypothesis. The contracts mark an acceleration of the devaluation in the coming months, although marginal. The other fact that the reader must weigh is that in the BCRA come the interest rate as a natural “guide” to bring both routes together.

In fact, it implies that the “ceiling” of the devaluation It could be the rate itself, say, 8% per month, maximum.

More pressure on the dollar, attention

Two ideas to add. The first, the trade surplus might not be as forceful forward as once thought. Not only the Harvest projections seem to be below what was previously established (lower soybean and corn harvests and a sharp cut in price compared to the previous year), but the brake on imports will begin to be fully released in April. This could bring additional pressure on the official exchange rate.

The second idea, also in the same sense: The Government needs at least an additional US$13,000 million to cancel debt between IMF, various emissions services, and the repayment of some agency loans. Where will they come from? The uprising of stocks prematurely could further complicate this scenario, which is why it will come, first, an acceleration of devaluation.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *