He Government seeks to obtain some US$10,000 million in the coming days to increase reserves and expand the intervention capacity of the BCRA. For that, he hopes that next Wednesday the second section of the swap of currencies with China, that the tender for the 5G and accelerate the exports with sectoral incentive programs announced in recent days. But uncertainty slowed sales in the agro-industrial complex and limited liquidations. What scenarios do the economic team imagine for the day after the next elections?
The exchange rate tension took a break for the second consecutive day, but the Ministry of Economy is clear that this will be a daily battle. To alleviate this pressure, the Executive hopes that next Wednesday the use of the second tranche of the currency exchange with China for about US$5,000 million will become effective. President Alberto Fernández will travel to Beijing and hopes to get official confirmation from his counterpart, Xi Jinping.
A few days later, on Tuesday, October 24, the tender for the frequency bands to use 5G technology will be announced. After long negotiations with companies in the sector, the National Communications Agency (ENACOM) assures that the auction will provide around US$1,050 million that will be settled through the CCL. They hope, in this way, to provide an offer to a highly in-demand market at these times.
Another bet is expansion of the “Soy Dollar” format to the wine, tobacco, sunflower, barley and leather industries. Although the incentive It has not had the desired effect so far.: “Everything is paralyzed, it is something that usually happens before the electoral process, but in this case it was aggravated because there is a candidate who says that the peso is worth nothing,” a source from the sector explained to Ámbito.
In the agribusiness they also point out that the resolution took a long time to come to fruition and in the end there will be only five business days to take advantage of the window of opportunity. Therefore, today the goal of obtaining close to US$2,000 million in this way (that of the different sectoral dollars) seems difficult to achieve. Of course, unless there is a new extension of the term of the measure that allows 25% of exports to be liquidated in the CCL.
The race has a key stop on October 22. All the market’s eyes are on the result of the election and the day after. The latest report from EPyCA consultants reflects the climate of the time: “In the last 365 days the CCL dollar multiplied its price by 3.1 and the MEP by 2.9. The outflow of capital from FCI continues (measured in dollars, today there is 14% less capital placed than on Monday, October 2) and fixed terms (US$55 million less so far this month).”
This Thursday, INDEC announced the inflation data September that once again reached double digits: 12.7%. Minutes later, The Central Bank decided to raise the monetary policy rate sharply to 133%, from the previous nominal annual 118%. In the official statement, the monetary authority indicated that it seeks to “limit the financial volatility observed during the electoral period and favor the accumulation of reserves,” although it is not clear what specific effect it may have in the peso flight scenario mentioned above.
At this time everything seems to indicate that the Government will keep its promise, it will keep the official exchange rate fixed at $350 until the elections. The holidays are in their favor, there will only be four wheels left until Sunday to resist the pressure. The day after is a big unknown. The economic team swears that there will not be a discrete jump as happened in the PASO.
“There is no room for that and it doesn’t make sense either because the discussion with the Monetary Fund is later, at the end of November,” they say. If, as the polls indicate, Massa reaches the second round, they estimate the return of the crawling peg for the middle of next month. If that does not happen, they also see no motivation for this administration to take charge of that movement, although they recognize that containing expectations will be much more difficult.
Source: Ambito
