The lowering of rates that the Central Bank had to face this Tuesday surprised its savers who since the end of the year They can’t find a tool to beat inflation, Even though it has started to slow down, it is still the financial variable that has grown the most this year and is eating away at everyone’s pockets.
Banks have moved from remunerating fixed terms to 110% per annum, 9.1% monthlyl regulated by the Central Bank, to offer a return of between 76% and 70% per year, i.e. a profit of between 6.3% and 5.8% per month, moops, inflation is less than 13% which was announced this Tuesday for February.
At the same time, the Center excluded mutual funds from the “passage window”, the reference letter of the economy, therefore money market funds, the most sought after by Argentines this year, They missed this investment opportunity and they will strongly see the sharp decline in the fixed forward rate.
To cite an example, Banco Galicia has reduced the annual rate of its Fima Premium Fund, the money market fund that allows 24/7 redemption in the entity’s app, to 67.9% per annum, from the 87% offered weeks ago. Therefore, the monthly performance of pesos in this account reaches just 5.8%.
Small savers are wondering whether, with these prices, it is not the time to doulse and take advantage of the drop in rates to protect themselves from a possible jump in the exchange rate or to bet on the carry trade and the profit that inflation-linked instruments can offer this year.
“An investor must consider three things,” said Diego Martínez Burzaco, country manager of the investment app Inviu: “First, what is the objective in which he wants to invest in pesos or any other currency. Second, define what type of coverage You want, if it’s a hedge against inflation, a hedge against the dollar. And then define your investment horizon, What is the period in which you are willing to invest?“.
“If the goal is to cover short-term monetary surpluses from inflation, There is no tool that generates such an expectation. Perhaps the only thing that can be done is a mutual fund that invests in companies’ peso debt, which they then adjust for value. This is mainly concentrated in funds called themes 1. And there it will have the best possible profitability today with the current rate structure, but it does not guarantee that it will be above inflation”, added Martínez Burzaco.
Along the same lines, Juan Manuel Franco declared: “Investments like money market and the fixed, risk-free maturity will result in a larger decline in the real stock of peso investments. We therefore believe that these are conservative profiles Fixed UVA terms can be an interesting alternative, as well as directly walletdollarization “prior to a free dollar level that we deem appropriate to do so”
“Meanwhile, riskier profiles betting on economic normalization in the medium term can see value in both global US dollar bonds and equity local, being in the latter case more unbalanced towards the sector energetic. That said, we must underline that episodes of political or social tension could cause short-term volatility in these high-risk assets,” Franco added.
Finally, Alain Fainsod, commercial director of the trading desk at Cocos Capital, underlined: “Although the government is making good steps in line with its goal, the challenge of accumulating dollars for the whole year remains great considering the normalization of imports and that in the second half of the year the flow of exports usually reverses”.
“Combining this diminishing incentive to save in pesos, the challenge of accumulating dollars, and the rapid increase in the cost of all ARS-denominated assets, we tend to offer, for those investors who can,dollarized options, both with tradable bonds and government bonds, depending on the risk they want to take”, concluded Fainsod.
Source: Clarin
