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The head of the Central Bank Miguel Ángel Pesce spoke of the tension on the markets and the delicate situation of local reserves. For the official, “we have adequate levels of reserves to meet the obligations of the Central Bank” and has ruled out that the reserves of dollar deposits are used. In this sense, he clarified that the Chinese swap is used: “It makes sense for us to do that. The trade is $ 20 billion, that’s the limit we have.”
“Chinese swap is used”Pesce said in radio statements.
Official sources have reinforced the words of the head of the Ukrainian: “The exchange with China is active. It has always been”. And they added to Clarin: “The BCRA uses it as part of the bank’s financial strategy. Above all, it is useful in bilateral trade, as a means of financing Chinese imports. “
The swap was activated for the second time since 2015. According to official sources, to access these funds “no negotiation is necessary, it is a financial operation”.
The exchange with China exceeds the equivalent of about 20,000 million dollars and, when using the tool, Argentina must pay a 7% in dollars.
The Central Bank of the Republic of Argentina (BCRA) signed its currency exchange agreements with the Bank of the People’s Republic of China (PBC) in 2020, which are valid for three years. The first agreement between the two central banks was signed in 2009.
The President of the Central Bank, Miguel Pesce, referred to the reserve situation and pointed it out “The energy issue plays an important role in the winter months. Still in August we are with a scam high levels of energy payment and hopefully this will calm down from next week. We expect a reduction of over $ 600 million payments, which would allow us to improve the situation of the foreign exchange balance ”.
In the dialogue with El Destape Radio, the official stressed that it also affects “The delay in the liquidation of the soy sector”. In that sense, he said: “We are on the order of 2,000 dollars or 2,500 million dollars behind schedule and we hope that it will be recomposed in the coming months.”
“We believe they are about to liquidate. They have to pay the costs of the new sowing “ Fish added. She also warned that “financing has a limit to the financing capacity of the manufacturer. The financial system allows for a low interest rate ”.
Regarding the energy situation, Pesce insisted that “in April we were importing 900 million dollars of energy; in July we reached US $ 2,400… we expect August imports to end up below US $ 1,800 and September imports below US $ 900 ”.
What happens to BCRA reserves
The Central Bank’s reserves are falling day by day. On Monday, the entity sold $ 84 million and has already lost $ 1,008 million since Thursday, July 28. when Sergio Massa was confirmed Minister of the Economy.
the former minister Silvina Batakis had described the lack of foreign currency in the Central as “desperate”. However, Pesce downplayed the issue: “We have adequate reserve levels to meet the Central Bank’s obligations.”
“We had lower reserve levels at the BCRA and were able to deal with the situation,” clarified. “The Central Bank is transparent about the levels of reserves and they are also controlled by the International Monetary Fund”, emphasized Pesce.
For the fish, “We have reasonable levels of reserves to fulfill the obligations we have “. In this sense, he warned that “we can end August with a situation of balance or partial recovery of reserves”.
Net reserves, which can be used to fix the exchange rate and supply importers are already close to $ 2,000 millionaccording to the calculation of FMyA, while the liquid ones, usable immediately, discounting gold and the IMF SDR, are at 5,900 million dollars.
The outflow of deposits is another of the worrying signs because they affect the level of reserves – 30% of the deposits of private banks are “embedded” in the central bank – and because they reveal the distrust of savers. In July, $ 800 million left the system.
Regarding inflation, Pesce underlined: “In March of this year we had an inflationary impulse due to the international order. The slowdown in progress until June was expected to stop in July, but it will not. We are working with the new economic team to moderate the inflationary momentum“. “The problem is how we moderate inflationary inertia,” she concluded.
YN
Source: Clarin
