Reserves remain under pressure. While the government is looking for funds abroad, The soybean dollar remains weak and the faces of the Central Bank Difficulty holding foreign currency. So, despite buying reserves over the last three wheels, he only made $200 million in the last 30 days. less than 10% of the currencies regulated by the validity of the new differential exchange with which the authorities bet to stop the bleeding.
The situation has set off alarm bells in official offices. cereal companies receive frequent phone calls from the Ministry of Economy to monitor the flow of dollars. Three weeks after the conclusion of the official program, there seems to be no intention of reviving the dollar to $300. “They call every day, ask, but no order, the soy supply market is also bad,” agribusiness sources say.
The soybean dollar did not perform as expected. Version 3.0 was affected by the delay in harvesting due to drought. but also for him increase in the exchange differential, expectations of devaluation and acceleration of inflation. “I think it holds little mainly because little is settled and almost no net balance remains between what is liquidated and the demand cleared to access the foreign exchange market,” said Andrés Reschini, analyst at F2.
The result is that the BCRA has withheld fewer dollars than previous programs, in which the entity was able to capture 65% and 74% of the regulated currencies, respectively. “This shows that the situation is quite critical, the shares are in negative territory because reserves keep drying up and at the same time the soybean dollar seems to be holding back,” said economist Salvador Vitelli.
The Minister of Economy, Sergio Massa, launched the third version on April 10 to obtain up to 6,000 million dollars, after the collapse of liquidations in January due to the drought. Since then, the program has contributed $2.12 billion, less than previous editions ($3 billion in September and $7.5 billion in December), without being able to stop the drain on reserves.
After the IMF disbursement of $5.4 billion in December, gross reserves fell by $8 billion over the year, and net reserves (not counting swaps, dollar reserve requirements and other liabilities of the central bank) have entered negative territory. Some consultants estimate them at -1,000 million. The lower liquidation of the agri-food sector, imports and the payment of the foreign debt to the Fund and to private bondholders had an impact.
The strategy to avoid a sudden devaluation also weighs in a scenario with poverty close to 40%. The Central Bank buys soybean dollars dearly ($300) and sells them cheap ($228). Thus, since April 10, it has issued $600,000 million to buy soybean dollars and has obtained $400,000 million for selling dollars on the market, which represents an implied exchange rate of more than $1,000 per dollar held, according to calculations by Reschini.
To avoid another run like last April, the government is now negotiating the revision of the program with the IMF and an upfront payment, which could amount to more than 10 billion dollars. Massa’s expectation is that the negotiations will be concluded in early June. There is also talk of an extension of the swap with China to pay for imports in yuan and of financing from Brazil with the support of the BRICS.
However, the trading situation is uncertain. Official intervention stabilized financial dollars. On Wednesday, the blue dollar closed slightly higher at $472, while the CCL dropped to $451. But the exchange rate peace could be temporary if reserves don’t stabilize. “We’ll see how it improves with the yuan and imports from Brazil, but how to reach the 20,000 sticks you lack? You have to fight,” they admit in official dispatches.
Source: Clarin
