The run for the dollar it didn’t stop despite the fact that the exporters liquidated $100 million of the $300 farm.
Nor has the hedging process stopped which gained momentum last week with the resignation of the president’s chief adviser Alberto Fernández, presented after he proposed a series of measures to reassure the foreign exchange market.
When Aracre was about to resign, the dollar in the settlement was $409. A week later, it was about $462 with an increase by 13% and with a widening of the gap to 110% with the wholesaler.
the jump of 18.5% of CCL in one month it was the reflection of the hedging process which corresponds to a sharp increase in the interest rate for dollar futures contracts.
This is approximately 200% annually, well above the 81% that the Central Bank pays to banks for Liquidity Letters (Leliq), which are the counterpart of fixed-term deposits of individuals and companies.
This photograph consolidates and aggravates a family situation: the government faces a severe shortage of dollars with many pesos lying around.
Many issues, many pesos and a widening exchange rate gap are the ideal breeding ground for a monthly inflation which has returned to 7% this month.
And, in the midst of a tense scenario, one question to ask yourself is Whether the dollar crisis responds to the inflationary leap or is fueled.
More for political reasons than for those strictly indicated by the cash flow (net reserves of the Central Bank), financial operators remain convinced that the duo Cristina Kirchner-Sergio Massa it will not devalue before the election.
They assume that Sergio Massa maintains his aspirations of being the presidential candidate del Frente de Todos and that objective is incompatible with any jump in the exchange rate and for this it needs, yes or yes, to get more dollars.
For weeks there has been talk of negotiations with the IMF to ensure that the organization upfront a large part of the US$10,600 million which he intends to grant until the end of the year so that, in turn, the government can pay him.
The economy hopes to convince the IMF of the need for aid based on the blow to exports that the drought has generated (20 billion dollars less than the previous year) and in return has already announced a reduction in electricity subsidies and would put a new rise in interest rates is on the table.
As regards the negotiation with Minister Sergio Massa, there is one detail: the Fund will give him 10.6 billion dollars so that the Central sell at $200 while the farm dollar is $300 and the CCL is $462?. Will Argentina’s weight in the regional political balance be so important for the United States?
Meanwhile, the currency hedging process is gaining momentum and business volume grew by 50% in the week going from 50 to 75 million dollars a day.
And on Monday of the $462 blue dollar, the central bank had managed to buy the aforementioned $100 million of the farm dollar, but it had to shell out $180 million to pay for imported energy.
The numbers are very good and Massa’s short-term strategy continues to be, as it has for the past couple of days (due to systems adjusting to a new resolution) link payments to import.
Imports reached $6.5 billion last month and foreign trade specialists believe that in April they would try to reduce them by about 1,000 million dollars.
It is a move with big risks in terms of inflationary expectations.
Faced with a more pronounced closure of the import payment, the hedge against uncertainty about What will be the dollar for which the commodity can be substituted is inevitable and growing.
This process is also reflected in the reports of foreign banks and investment funds which highlight the fiscal weakness of the government to meet deadlines until the end of the year if it does not resort to issuing pesos outright.
One of them, from the American giant JP Morgan, argued that the Argentina to drop 3.3% and that the total fiscal deficit (adding the BCRA quasi-fiscal deficit) will reach 12.7% of GDP.
Imbalances are important and it is precisely in such an unbalanced economy where the risks of the appearance of black swans grow.
Source: Clarin
