He market believes that the government is going to continue with the blender to the maximumThat is, the Central Bank is going to further lower interest rates with the idea of reducing the entity’s monetary liabilities, and in this way it will also continue to clean up excess money.
This is shown by a survey by the consulting firm D’Alessio Irol for the Argentine Institute of Finance Executives (IAEF)in which he consulted company finance managers about the outlook for the economy for 2024.
In general, the respondents are optimistic about the future of the economy and it assumes that at some point next year the government will return to international markets.
The study says that 67% of those consulted expect the BCRA to continue lowering the cost of money. 28% believe that rates will decrease considerably, 39% that they will decrease moderately, while 21% say that they will remain stable.
Instead, Half of those surveyed estimate that the dollar will rise this year. 44% believe that they will do it moderately and 6% considerably.
The Treasury also continues to lower the rate
Taking advantage of the fall, The government went out this week to tender again capitalizable bills, LECAPs, that although they accrue interest every month, they have zero coupon in 2025.
The last placement was made at a rate of 5.5% monthly, against a current inflation that runs at 12%. The accepted rate indicates that the market sees a significant reduction in inflation ahead.
In the last Treasury tender, There were maturities for $540,000 million, and $1.32 trillion were taken. $545,000 million were LECAPS. Then $505,000 million and $272,000 million in inflation-adjustable bonds were placed.
The government announced that some $780,000 million surpluses from the last call, plus the accumulated from previous calls, will be used to cancel maturities in dollars of US$2,000 million in Julywhich will serve to absorb weights.
The opinion of a consultant
Despite the reduction in rates from 133% to the current 80%, the absorption of pesos through the issuance of bonds for importers (BOPREAL) and other actions, lThe issuance of pesos for remuneration of remunerated liabilities of the Central Bank increases the currency surplus daily.
According to the consultant, Ricardo Inti Alpert, from the consulting firm Tecnolítico, the Central Bank was issuing pesos at a rate of $70,000 million per day.
Inti Alpert estimates that the Central Bank has issued ““enough pesos to demand almost US$30,000 million in one year” and therefore “hope that the exchange rate does not feel it, it is risky.”
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“To the excellent work done on fiscal spending, we must add another work of greater technical complexity to resolve the BCRA deficit, which, with an improved balance, continues to be Argentina’s flat tire,” he added.
He states that “the monetary base does not measure the issuance of pesos that increase the accounts of individuals when the BCRA takes it as debt and increases stocks day by day, so to evaluate the creation of pesos
In that sense, he said that “The base registered only an 18% increase since the government began but deposits grew 57%.”
Source: Ambito
