The exchange rate tensions of the past two weeks have forced emergency measures to contain the dollar. The rate hike and the Central Bank’s intervention partially pushed prices back from their highs (this Monday the blue rose to $474).
But the shot was not free and reflected daily decline in dollar deposits of the private sector, a phenomenon which began to manifest itself at the end of February and which has now calmed down.
The latest data from the Central Bank show a stock of $15,505 million as of April 25, about 400 million dollars less that on Friday the 14th of that month – the day on which inflation of 7.7% was announced and the race for exchange broke out – and approximately US$800 million less since the beginning of the year5% of the total stock in that currency.
In the middle, the blue dollar has approached $500 last week, what the demand for tickets for the Central Station by financial institutions increased.
“For now it’s that, a daily drip, logical in pre-election times and exchange tension. But we do not consider it a concern however, banks’ dollar liquidity continues to be high and the withdrawal of these deposits does not affect net reserves, which are the ones we look at because they are not included in the calculation, not being freely available at the Central Bank,” they pointed out in a national bank.
In the financial sector they believe it last week’s measures have calmed the waters. In an orderly swerve by Sergio Massa, Centrale accelerated the rise of the official dollar and rates increased on Thursday of fixed retail terms at 91% (141% in effective annual terms). Also he used reserves to appease financial dollars and this Monday the purchase of cash with liqui (CCL) with credit (guarantee or subscriptions) was suspended.
“Last week we had a little more than normal withdrawal from depositsespecially on Tuesday and Wednesday, the rate hike may just show us this week an overview of how everything will continue, at least this Tuesday was a quiet day of operations,” they said in a foreign bank.
“After many days, drainage decreased: We will continue to monitor that variable”, they assured another private entity.
One of the factors that would have influenced savers’ expectations is the difficulty in accumulating foreign currency. Without the full impact of drought, net reserves are down $5.6 billion this year until the beginning of April and they hovered just around $50 million on Friday, the lowest level since early September, when the government launched the first soy dollar, according to Ecolatina. And on Tuesday, for the fourth round in a row, it sold foreign currency on the market ($133 million).
In running another bank with foreign capital, they believe there was “scare, political noise, many people talk about net reserves. “Interestingly, he hasn’t recovered towards the end of last week and is calmer,” they added.
Indeed, the stock of “argendólares” continues at levels similar to those prior to the resignation of Martín Guzmán from the Ministry of Economy last July. For that crisis withdrawals of US$1,000 million were made, which were subsequently reversed.
“People get scared because they hear that the Central Bank has minimal reserves and the ghosts of what happened after the Convertibility have been fed, but the current situation is very different from what it was then,” said Matías de Luca, economist at LCG.
However, he did not rule out that the rise in the dollar may have given rise to some “curls” (sell in the blue and buy MEP) which stimulated the outflow of dollar deposits.
The uncertainties on the electoral scenario and the uncertainty due to a possible dollarization also adds tensions. “Of course, structurally there is a short supply of dollars due to the drought and an imbalance in the relative prices of the foreign exchange market, but until the political noise settles, dollar deposits are likely to continue to suffer a fall,” said Lucio Garay Méndez, an analyst at EcoGo.
In the official offices they ensure that the situation is normal and that there is free availability of tickets. In this sense, the latest BCRA bank report proves it indicators of currency liquidity of the financial system are above 80%. This means that “banks can cope with withdrawals from savers looking for another destination for their dollars,” according to Francisco Ritorto, economist at ACM.
“This is the result of the nervousness that has occurred with the foreign exchange market, which happens normally. It is understood that a good part of these deposits correspond to legal entities instead of physical, which allows us to interpret that the IV may be more limited later on. Even so, even if we can consider it ‘expected’, Production in recent weeks has reached its highest level since July last yearRite said.
Source: Clarin
