Despite more regulations, controls, hurdles, inventories or ceilings that have been built around the foreign exchange market in recent years, dollar operations continue to respond, somewhere, to the old rules of supply and demand.
In an Argentina in crisis, which is to say almost always, the demand for dollars is still alive. But this year the offer will be drastically reduced. The reason is well known. The drought, the worst in a century. Stones get worse week by week. Rounding off, there will be neither more nor less than 20,000 million dollars. The pressure on prices in dollars can essentially be explained by this.
The Central Bank cannot collect reserves, importers do their utmost to reach the Central Bank counter. The Central Bank prints as many pesos as there are new circulars to be sown new barriers to access to the dollar. It must be said that the temptation of the official dollar is as legitimate as it is obvious. The 100% gap is the key. Anyone with access to the official dollars is partying. At the expense of exporters, between them and in the front row, the field.
In an attempt to cover the sun with its hands, the government has taken unorthodox measures: intervened at a loss in the government securities market to try to lower the price of the dollar with liquidity. More heterodoxy: people close to the economy phones at the money tables and newsrooms! to try to draw the price of the dollar that appears on the screens. It also poses new obstacles for importers, who are forced to postpone payment of long-standing debts.
But there is also politics. The government does not want to devalue and instead offers partial devaluations for part of the exporters, soybeans and so-called regional economies. Is not enough.
Refusing to devalue a service has come to the fore these days. It is said that the IMF is demanding it more insistently. It was said that the former chief councilor of Casa Rosada, Antonio Aracre, had proposed it, and for this they fired him. Alberto Fernández and Sergio Massa meet to give signs of calm. Little credibility, but what matters is the intention. If Massa has no intention of giving up something, it’s the bulletins and photos that show that there is management.
In political terms, the refusal to devalue is understandable: to devalue is to deliver the election without a fight.
But of course we are in an election year. Those who have pesos in his possession are wondering what will happen to the economy, not December 11, when the government will change. The calendar looks to the Monday following STEP. If, plus all the tensions of election years add the noise for now very confused dollarizationThere’s not much more to explain.
And inflation too. The Central Bank continues to raise rates so that those encouraged to save in pesos don’t go with their fixed term to other dollars, legal or illegal. But the story plays against those expressions of wishes. At some point there is no positive interest rate it reaches. And unfortunately history says that in these situations people are not wrong.
Source: Clarin
