The export dollar begins to lose competitiveness and the exit from the stocks is delayed. The impact of the exchange rate delay is beginning to be felt in the industry that watches Brazil devalue. Despite the recent signal from the Executive, agriculture is planted.
The Government’s primary objective at this time is to lower inflation. The Minister of Economy, Luis Caputo, subordinates economic policy decisions to that priority. Meanwhile, the export dollar begins to lose competitiveness and the exit from the stocks is delayed. The impact of the exchange rate delay is beginning to be felt in the industry that sees how Brazil devalues the real. Despite the recent signal from the Executive, agriculture is planted. Meanwhile, the Central Bank’s reserves remain in negative territory.
When this Friday the INDEC releases the consumer price index, the Government will be able to score a victory: the disinflation path continued in March despite being a month of high seasonality. In the last few hours, the Central Bank released the Market Expectations Survey, whose data stood at 12.5% for March.
That downward staircase has other costs. Caputo postponed the increase in gas rates until April, is straining the AMBA transportation system to the maximum by not updating the cost structure, put a brake on the recomposition of real salaries and keeps the exchange rate semi-frozen despite to the high nominality of the entire economy. Everything to contain inflation.
This new computer of economic policy also postpones the total opening of the stocks, which had been forecast for May. Something that today seems practically impossible. In their last public appearances, they asked President Javier Milei about the end of exchange restrictions. The detours are getting longer and the answers are getting less and less concrete. This happens for a simple reason: The Government is in no rush to lift the trap. Both Caputo and the head of the Central Bank, Santiago Bausili, are extremely cautious about the matter.
The president of the BCRA himself took it upon himself days ago to deny the supposed imminent elimination of the restrictions that operate on financial dollars. There was even some corrective for the presidential spokesperson Manuel Adorni who last Friday assured that net reserves had moved into positive territory, when even with the purchases that have been chaining since the beginning of the year, they continue in the red. Something that if the pace of purchases is sustained could be reversed this week or next.
Warning lights in different sectors
Meanwhile, the exchange rate delay begins to turn on alarm lights in different sectors. The industry, which has already been hit by the drop in consumption, is now looking askance at what is happening in Brazil. The thing is The Real has devalued more than 4% so far this year and threatens to take away the competitiveness of local manufacturers both in the own market and in export markets.
The history of agriculture is better known. As Ámbito revealed, the export sector is demanding a better price to mobilize the 100 million tons that make up the coarse harvest. This improvement, they say, could come via devaluation, removal of withholdings or “special conditions”, as the Government deems appropriate.
This Monday afternoon Caputo sent a signal. He announced a reduction in tariffs for the import of herbicides and an “improvement in Senasa permit approvals.” Specifically, it is a recognition that the input-output relationship is working very badly for producers; Instead of removing withholdings, the aim is to lower the cost of inputs. In the sector they consider it “not very significant” and “insufficient”.
Source: Ambito
