He central bank (BCRA) closed this Thursday its third consecutive day with sales in the exchange market, after the end of the soybean dollar last week. The monetary authority assisted in the last 3 wheels with US$186 million and ended the positive streak of 20 consecutive days with a positive balance, thanks to the differential exchange rate of $300 for soybeans and their industrial derivatives.
The reserves of the Central continue in free fall. In a context of lack of dollars, the BCRA has to continue intervening in the market, since at the end of the soybean dollar 3 the settlements of the sector fall (as observed after the PIE 1 and 2). And as we are close to the Simultaneous and Mandatory Open Primary elections (PASO), exchange rate volatility is growing and the possibilities of a stress in the market are growing.
The BCRA’s gross reserves are US$32,676 million, “US$12,000 million less compared to a year ago,” he told Scope Claudio Caprarulodirector of Analytical Consultant. Therefore, the “net reserves, those freely available, are negative.” In this case, the monetary authority covers “the difference through the use of the line of loans with China, the famous swap“.
In addition, this year approximately a floor of US$20,000 million will be lost due to the fall in agricultural exports as a result of the historic drought.
In this sense, the economist Martin Kalosdirector of EPyCA Consultantsexplained in dialogue with this medium that “reserves are needed that are liquid and available to intervene in those moments, since it is part of the role that the BCRA has to play to stabilize in the event of any crisis episode”. And he stressed that the Government should get $4 billion to strengthen the reserves, according to the estimates they made from EPyCA based on the analysis of the interventions that had to be made for the previous elections (2011, 2015, 2019), each one with its particularities.
“The exchange market situation is limit”
Now, through what tools can these reserves be obtained for the second semester, where the demand for dollars is seasonally higher? One of the keys, on which economists agree, has to do with the negotiation with the IMF and the possibility of modifying the disbursements and maturities that the Palacio de Hacienda has been requesting from the multilateral organization.
One of the possibilities, which is not ruled out, but due to the critical situation of the drought does not seem so probable, is that of a new differential exchange rate for the soybean complex. “The soybean dollar was effective when there was a price problemexporters did not settle because they wanted a higher exchange rate. Today the problem is one of quantity, the drought sharply reduced production, there is less harvest to liquidate. So, improving the price to the exporter can have some positive impact, but it does not solve the underlying problem, will not generate a significant income of dollars” Caprarulo said.
In this sense, Kalos added that “a new soybean dollar would not be recommended”, since the 2022/23 campaign was greatly reduced due to the drought and “producers need to liquidate or sell to harvest again.” At the same time, “It would not be a good precedent in terms of incentives, since instead of liquidating, from now on producers will wait for the next soybean dollar”he pointed out, although he stressed that in a moment of urgency, the Government “could decide to use the tool eventually.”
On the contrary, the economic analyst of Invecq Manuel Cerdán He stated in dialogue with Ámbito, that “given the critical situation of net reserves -comfortably in negative territory- and the intention not to significantly adjust the official exchange rate, it is most likely that the Government will continue using the same recipe as in recent months : greater exchange restrictions, and the search for dollars through any possible channel, where clearly one of the possibilities is to launch differential exchange rates again”.
In recent weeks, the BCRA resolved to apply a series of restrictions on access to the dollar for debt payments of the provinces and municipalities. In turn, the Government tightened the restrictions on automotive section and to the oil companiesdue to the lack of dollars that is increasingly pressing.
Another of the resources that the Government intends to use to strengthen the reserves will be the possible incorporation of Argentina into the bank of the BRICS -the group made up of Brazil, Russia, India, China and South Africa- that the entity’s board of directors will discuss at the next meeting scheduled for the first week of August in South Africa.
To finalize their incorporation, the Brics bank will receive a Capital contribution from the Argentine State for US$250 million in sovereign bonds from the Treasury, from the Anses Guarantee and Sustainability Fund and from other channels, confirmed from the economic portfolio.
This figure would mean 25% of the total of US$1,000 million in injection of funds that the financial institution would receive within two months, since the meeting in South Africa will resolve the incorporation into the New Development Bank from three other countries: Saudi Arabia, Egypt and Zimbabwe.
Source: Ambito
