The Central Bank said it would “take the next steps with stocks and that they will try to return to the markets”

The Central Bank assured this on Thursday morning the monthly increase in the exchange rate of 2% is approaching the level of inflationstated that there will be new measures to ease currency restrictions – although first attempts are made to accelerate this process through the large investment regime (RIGI) -, and stated that the idea is to return to the international debt markets, a once the government is done with its “homework.”

“The creeping 2% peg was a key anchor because the confrontation between the opposition and the government created fiscal uncertainty and our rate policy was unusual, so we needed the 2% peg and now inflation is very close to 2%, bringing us closer to zero because it is 2% plus international inflationthen we will have liquidity for a healthy foreign exchange market,” BCRA Vice President Vladimir Werning said in Washington.

And then he said he was optimistic about the normalization of the exchange market: “We have room for changes in the interest rate and exchange rate, we will take the next steps, but we are looking for ways to accelerate them“We have a balance between equities and flows, we have done a lot with the former, but in terms of flows we have the RIGI regime, if you invest $200 million or more you have no exchange restrictions.”

The number two of the Central made these statements at the annual event of the International Institute of Finance (IIF), where he participated in a panel on the challenges facing emerging markets. Werning has been in Washington since Monday as part of the delegation led by Luis Caputo they went to the summit of the Monetary Fund, where they try to unblock a new program with the body with fresh funds.

Argentina has become an attractive emerging market for investment funds thanks to the low price of its government bonds. Stocks rose 2% this Thursday and country risk fell to 1,050 basis points. The possibility of the government receiving flows from organizations and banks reduces restructuring risks of debt, but the risk of Argentine debt remains high with rates of 15%.

“Our vision is to return to the markets once we have finished our homework, it is not easy. We received the worst indicators, but with the strong conviction of the president what we did was lower inflation from levels of 25% per month to 4%, the economy entered a great recession, but it is already exiting mid-year, we have three months of improvements in leading indicators, but we had to repay the previous government’s debt,” Werning said.

The vice-president of the BCRA acknowledged that there were doubts in the market “whether it could go wrong” and that since the middle of the year they have left the “black swans” behind and are starting to see “white swans”. In this sense, he noted that “economic policy served to anchor the exchange rate and capital flows were normalized“, although they have yet to remove controls that limit the outflow of dollars.

“The trading account works well, We have restrictions, we want to eliminate them in the future, but we face many challengesThe first is to eliminate the fiscal deficit, it is the cornerstone of our program, that is what we have done in a month, we have achieved significant results during the year and the banking system is normalizing, allowing liquidity, it is a good starting point first eliminate capital controls,” he explained.

And he underlined that the economy began a remonetization process in the middle of the year: “Inflation has fallen and many Argentines want to have pesos, this is fundamental if we want to remonetize the economy, the banks immediately understood that without the issuance government would profit from loans to the private sector, are reorienting the business, and In the last month the Argentines have earned 15,000 million dollarsdoubles Macri’s money laundering.”

Finally, during negotiations with the IMF as part of the organization’s annual summit, Werning stressed that the government has done “enough” with the normalization of import payments. “Companies have paid their debts and there is room for exchange rate flexibility, we want to do it from a position of strengthInitially it was a huge devaluation and now prices are more aligned”, he assured.