An incredulous market asks Batakis that tax definitions return to normal

Silvina Batakis took over the Ministry of Economy in the midst of growing financial tensions in the local market. “I believe in fiscal balance and I think we need to move in that direction. And in the liberation of all the productive forces of our country to obtain real jobs and more exports. I believe that this is the path and the task entrusted to me by the President “, he said after taking the oath.

This Tuesday the market will resume trading with an external reference, after a day with partial movements due to the holidays of this Monday in the United States. It will be the Minister’s real debut, that you will have to try to convince local and foreign investors.

He has a difficult game ahead of him: the dollar bonds that its predecessor traded in 2020 lose nearly 38% of their value over the year and the the country risk flirts with 2,500 points.

“In addition to receiving an economy with a growing fiscal deficit, pressures on international reserves, country risk above 2,400 points and monthly inflation around 5% per month, one of the minister’s first challenges will be to reaffirm the agreement with the IMF, one of the main legacies that Guzmán left him, “said Cohen’s Martín Polo.

“It will also be important to determine how your cabinet will be formed, especially in key secretariats such as the Budget and Finance. No further government changes have been reported so far, “she added.

Market skepticism is great. In an email to his clients, economist Emmanuel Alvarez Agis, one of those who seemed to take the position that Batakis has finally taken, warns: “After the debt crisis in pesos and the extreme measures taken by the monetary authority to recover the international reserves, the government of Alberto Fernández and Cristina Fernández de Kirchner has entered its most complex moment since the change of administration “

Agis warned clients of its PXQ consultancy: “We have already entered a financial crisis of uncertain resolution”.: “These are difficult times to provide quantitative arguments to a crisis which is mostly political and self-inflicted, and which remains unresolved.”

His pessimism was shared by the CEO of an investment bank. “At this point, that’s not what Batakis is doing, he can’t do anything to dispel the extreme distrust generated by domestic politics within the government,” he commented.

Meanwhile in the consulting firm 1816 they indicated: “Guzmán is gone and if the government wants to make abrupt changes talking about the” legacy “of the former minister, the ideal moment could be now”.

“We suspect that Batakis does not have a team or a plan to get started so quickly, so to understand the new management we will certainly need to be patient. In the next few hours we will find out who is in charge of Finance, if Chodos continues in FM and how the program continues with the Fund. “added the economists.

For Franco Mattig, of Consultatio, said: “The monetary situation is so out of control, that I believe that the only thing that would serve to calm the market is a clear fiscal signal. Go ahead with the segmentation of tariffs, the adjustment of transport subsidies and cuts in other ways, for example on the side of relations with the provinces, “he listed.

“Something else can make us win a week or two, but the market will lead you to do it any way,” Mattig said, adding: “The most important thing is to recover the pesos funding and this can only be achieved with the signal. Fiscal Meanwhile (ie, a matter of days), that the BCRA continues to defend the peso curve is critical, but will only lead to higher inflation if it does not show fiscal commitment. “

YN