He is an expert in financial matters and in building investment portfolios for retailers and wholesalers. He uses few words and the question was:What are savers doing to protect themselves in an election year?
“Resellers buy Tickets (blue dollar), the big names continue to bet on shares, the riskiest ones on bonds in dollars and companies are no longer able to find shelter for pesos and end up in peso banknotes (Ledes) Treasury, after being filled with dollar-linked bonds (linked to the dollar) those that count and linked to the CER (inflation-cost of living) the rest.
The paths of money define, to a large extent, the expectations of the business world regarding this uncertain 2023 with the presidential elections.
Much of the investment scaffolding is based on the bet that the Minister of Economy Sergio Massa works for his presidential candidacy and, therefore, will try in every way to avoid a large weight devaluation.
So, they think there will be a dollar of soybeans 3 or a dollar of meat 1 per sectorally devalue in an effort to obtain scarce dollars to meet the year’s deadlines and maintain economic activity, avoiding accumulate more arrears in payment of imports, which would already reach 9,000 million dollars.
Sweeping foreign payment commitments under the carpet was one of the elements he denounced Together for change Over the week, however, dollar bonds (an indicator of distrust of confidence) continued to rise. What do the markets speculate with?
The imagination flies and they believe that Massa can advance on Sustainability Guarantee Fund obtain more dollarized bonds with the aim of completing a guarantee (Repo) and obtain US$ 1,000 million or more from the banks.
For the Treasury, the cost would not be less: it is necessary to invest about 3,000 million dollars in bonds to get US $1,000 million, but the minister and the government know it in an electoral plan The worst that can happen to them is running out of currency.
For this to materialise, market participants say, it would require bonds that are currently trading at around US$36 (GD30) to rise to US$40 (this is the profit wholesale investors expect) and that is the engine of the improvement of these titles that have the it threatens to be restructured at some point.
Investors betting on the rise in shares of private companies have their recent history in favor (Merval up 20% so far in 2023 e 183% in one year) and insist on the fact that the Stock Exchange still has an upward trend, even if they do not rule out declines due to profit-taking by those who believe that the best time is happening.
They watch the concentration of debt in pesos in April ($1.9 billion) and they question how Massa will get the renewal a few months before the primary with the “financial wall” which implies the market resistance to borrow after the elections.
In the midst of the doubts there are a couple of certainties: one is that Central Bank raises wholesale dollar by just over 5% per month and, therefore, goes at a rate less than inflation (would have been close to 6% in January) but still doesn’t imply a sensitive delay for the election year.
The other certainty is that salaries start in 2023 with a 15% quarterly increase which is part of the government’s target for parities to rotate at 60% for the year, with a trigger clause in the event of an inflation overflow.
Official dollar and parity traveling at 5% per month is the picture the government tries with the “fair prices” slowed down and the remainder up 3.2% monthly through June. Is it imaginary?
The economy shows that inflation has a plan at 5% per month and that the “anchor” continues to bet on an exchange rate gap (difference between the wholesale dollar and the free dollar) of 95% unstable characteristics as long as the central bank continues to be more of a seller than a buyer of currencies.
Source: Clarin
