Although March has not yet ended, it can be seen that the path taken so far has been to accelerate the crawling peg, even with the risk of injecting more fuel into inflationary pressures. And it will be this variable, the one that the Central Bank will follow closely to move. The objective is not to delay the exchange rate and to encourage again the expectations that make the parallel dollars jump. A calmer dollar could guarantee that inflation moderates in the second half of the year. In turn, the acceleration of the crawling peg with the third rise in interest rates in the year curbs the negative incentives for liquidating foreign exchange.
In line with what was negotiated with the IMF, the official dollar will accompany, as far as possible, the monthly price rise indices in order to avoid a devaluation jump that will hit the pockets of Argentines again.
After a slight adjustment in December, when the Central Bank devalued at a level of 1.3%, in January, the rate increased a little more and the US currency appreciated around 2.2%, while, in the second month of 2022, the rate was 2.3%. In March, the number will be closer to 3%, but still far from the expected rate of inflation for the month.
The final formulation reached with the IMF allows the dollar to move behind the local inflation rate, even though the rate of depreciation gradually accelerates.
On the other hand, the level of net reserves also increased after the IMF disbursement. This is another of the goals that must be met in the agreement with the agency. The goal of net reserves for the end of March is USD 3,550 million and it is being met.
Economist Miguel Kiguel diagnosed that after the agreement with the Fund, the value of the official dollar will move “more or less in line with inflation”, while the latter variable will exceed last year’s total. “The dollar had already escaped a lot when it went to 230 and then returned to levels of 200, which is far from being a summer”, the specialist summed up the “Dato sobre datos” program, on radio Milenium, about the evolution of the price of the US currency in recent months.
However, for Kiguel, the dollar will not be at the ideal value, which he stated is $120 or $130 but affirmed that “it will continue to move more or less in line with inflation.”
Source: Ambito
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