Dollar: the market is closely monitoring the gap and they hope it does not affect inflation expectations

The Government did not extend the validity of the PAIS Tax, which taxed the demand for foreign currency at 30%, although it maintained the collection of 30% as Profits for the purchase of foreign currency.

“The data remains positive: fiscal and trade surplus in November, wholesale inflation below the ‘crawling peg’ and consumer confidence on the rise,” SBS Group said. “Finally, the International Monetary Fund confirmed that a new agreement with Argentina is being negotiated,” he added.

“The consequences of a stronger currency were investors’ main concerns in mid-2024, but the accumulation of reserves and the reduction of the exchange gap has alleviated those fears”said Max Capital. “The deregulation agenda, along with improvements in access to credit, are fundamental pillars to sustain this sustained economic growth in the coming years,” said Lautaro Moschet, of the Libertad y Progreso Foundation.

“With a December that would once again be a surplus, it is to be expected that the year 2024 closes with a trade surplus around US$19 billion,” estimated the consulting firm ABECEB.

“While by 2025 the expectation is that exports continue to grow at a good pace, but lower than that of imports that could move at a rate of 15% (floor) in a context of economic activity in clear recovery – growing at 4% or 5% -, greater economic openness and a more appreciated exchange rate in terms real. Thus, the trade surplus would be reduced to values ​​around 13,000/14,000 million next year“he noted.

“In an optimistic scenario on the exchange front, with a crawling peg of 1% monthly starting in February 2025 and a gap stabilized at 5%, the LECAP due in June 2025 (S30J5) could offer a yield of 18% in dollars“Delphos Investment said.

He added that “this would imply a ‘break-even’ country risk close to 500 basis points, a reasonable level in a context of greater exchange stability and consolidation of the disinflationary process. This scenario would allow a greater compression of the country risk, positioning Argentina in line with the regional average of Latin America,” he estimated.

Investors are watching the dollar closely, hoping it does not impact inflation expectations.

“While the external context is monitored, especially the noise in Brazil, the depreciations of emerging currencies and the weakness of soybeans, Operators remain attentive to the progress of financial dollars after the recent rearrangement, which left the ‘gap’ slightly above 10%,” said economist Gustavo Ber.

“This is why operators are attentive to interventions and reserves, given that a stabilization of the dollar ‘MEP’ and ‘CCL’ would be important in order to not affect expectations and that in this way we can continue advancing in the disinflation process,” he noted.

Economic data in 2024 generates a good outlook for 2025

“Industrial activity adjusted for seasonality in November had an improvement of 1% compared to October and fell 2.3% in the interannual comparison,” revealed a report from the FIEL foundation. The real estate market closes 2024 with a positive balance which marked the beginning of its recovery after six long years of crisis, especially in the real estate scenario, more than 50,000 homes under construction remain active in construction, said a report from Grupo Construya.

“The relative economic stability and exchange rate control are, without a doubt, promoters of positive expectations. However, the Government does not achieve majority support because the brutal adjustment program that it implemented a year ago has produced severe consequences in daily life, which means that a good part of the citizens does not support its plan,” said Marina Acosta. , director of Analogies Communication.

“The biunivocal relationship between adjustment and this type of stabilization is the one that will be subject to electoral scrutiny next year,” he estimated.