A renowned analyst from a city broker commented to Ámbito It seems like it’s time to buy MEP dollar to dollarize the portfolios and take advantage of the low price which, by the way, seems to have found its floor near $1,150. He also warned, due to the wear and tear of the “carry trade“, because it is limited in the short term.
And analysts see difficulties in the short term for the “carry trade” and warn of “high risks”, because with the dollar at low levels, selling currencies to obtain returns in pesos implies an increasing cost, since there is the risk that an unexpected event will cause the dollar to rise, reversing its downward trend and complicating that strategy.
That’s why, Experts maintain that some investors who carried out “carry trades” in previous weeks or months are already considering the possibility of reversing that position, “moving their investments into dollarized assets.” At the same time, those who are already positioned in dollars show little interest in selling at current prices to carry out “carry trade” in pesos.
Another operator from the city commented in dialogue with this medium that “with the rise of parallel dollars, more than one refuses to get out of carry.” And he adds that: “at these Mep values, we have already begun to rotate the greenback a little. Well, it shoots up a couple of points and wipes out any rate.”
The look of a city guru
One of the mainstream economists of the moment, Marina Dal Poggetto, from EcoGo, analyzed the drop in inflation in recent months, after the peak of 25.5% reached in December as a consequence of the devaluation implemented by Javier Milei and Luis Caputo at beginning of his management.
Dal Poggetto explained that the current measures are driving a carry trade context, highlighting the difference between credit rates and the yields of Treasury instruments, along with a crawling peg of 2% per month. “A scenario is being coordinated where the exchange rate moves in a controlled manner, which prolongs stability,” he said in an interview with Radio Rivadavia.
For the expert, the Government set its exchange strategy around “anchors” that point to a stable monthly devaluation of 2% and the maintenance of the CCL dollar through market intervention. These policies manage to moderate inflation, although gradually. According to Dal Poggetto, The coexistence of an exchange rate delay with an interest rate of 4% in dollars is generating an increase in the stock of debt measured in that currency.
This environment encourages carry tradegiven that the rate differential offers attractive returns. “You are paying a rate of 2% in dollars per month, which in annualized terms is equivalent to between 26% and 27%,” the economist warned. However, he also warned about latent risks: “It is a favorable scenario as long as everything remains in balance“.
Finally, Dal Poggetto left an open question: how will the transition be made to a scheme where the exchange rate could eventually affect the competitiveness of the economy?
Source: Ambito
