In a scenario of a relatively “cheap” dollar and a inflation in decline, the economist Marina Dal Poggettodirector of the consulting firm Eco Go, analyzed the possible implications for the economic policy of Javier Milei’s government.
In recent statements, Dal Poggetto highlighted key points related to the exchange rate, reserves and the challenges of maintaining economic balance.
Segmentation of the foreign exchange market
According to Dal Poggetto, the exchange market is clearly divided into two main segments: the official dollar at $1,030 and the financial ones (CCL and MEP) at $1200.
This doubling, as a result of capital controls, reflects a disparity that makes the accumulation of reserves difficult and could compromise the sustainability of the current scheme.
Exchange delay: an imminent problem?
The economist warned of a possible exchange rate delay, pointing out that the real exchange rate is returning to levels prior to the 2024 devaluation. This is due, in part, to the impact of inflation on the adjustment of the dollar and the strength of the dollar against to other currencies.
“We are getting closer to the values of convertibility. There is a problem, although the government does not like to call it exchange rate delay,” he stated.
Negative reserves and exchange gap
Dal Poggetto pointed out that, despite efforts to pour dollars into the market, the Central Bank has not managed to accumulate reserves. “Net reserves remain negative, which creates a fragile scenario,” he explained. This raises questions about the government’s ability to sustain its exchange rate policy without a significant increase in international reserves.
Reduction of the crawling peg and the anti-inflationary strategy
Javier Milei recently confirmed that the pace of dollar devaluation (crawling peg) could decrease from 2% to 1% per month if inflation continues at around 2.5% per month. The goal would be to stabilize inflation at 1.5% in the medium term.
Dal Poggetto, however, warned that this strategy could accentuate exchange rate tensions and aggravate dependence on available reserves.
Source: Ambito
