In the context of decline in reserves and funding capacity and, faced with an increasingly reluctant market to continue to finance the needs of the Treasury, the Government has once again turned to the Central Bank to get yourself a life preserver. Last Friday for first time Since the beginning of the year, the body chaired by Miguel Pesce wired the Treasury $130,000 million.
According to market sources, this shift will not have a monetary effect for now. However I knowand it’s just below the top of transitional advances agreed with the IMF for this first quarter, set at 139.300 million dollars.
Although reserve accumulation targets have been eased this month, those that have to do with the currency they remained unchanged.
Thus, the Government has also promised that transfers from the Central Bank to the Treasury will not exceed $372,800 million in the second quarter, $651,400 million for September and $883,000 million accumulated for the year. That is, 0.6% of GDP.
Last year the Government managed to surpass this goal, mainly thanks to the fact that in the last quarter, since the arrival of Sergio Massa at the Palacio de Hacienda, the Treasury had not requested monetary assistance from the Central Bank. In this way, for at least eight months, the Centrale did not have to issue pesos to finance the expenditure.
The good performance of the debt market in pesos had allowed the Treasury to renounce this type of aid, but the demands posed by the election year in a context of lower tax collection due to the impact of the drought and in the face of a “closed” debt market for placements after presidential replacement, forced to resort to the usual assistance.
In January and February, the the fiscal deficit increased and the public accounts have accumulated a deficit of 432,000 million dollars. In this context, for the first time during the year, the Government made use of the direct assistance of the Central Bank.
In the market they believe that liquidity needs remain high this month, so they are not ruling out new tacks.
Delphos analysts have pointed out that it is a “bad sign in the sea of uncertainty current, denoting the lack of box of the Treasury which led him to implement this complex debt transaction which is basically nothing more than an issue of Bonares in order to obtain new financing to cover the fiscal gap”.
Source: Clarin
