Dollar in the sight: the IMF warned about the need to accumulate reservations and talked about YPF failure

An Argentine economic team is located in Washington participating in the first review of the program agreed with the International Monetary Fund (IMF). He pointed out Julie Kozackspokeswoman of the agency, this Thursday in the framework of one of the usual press conferences confirming what is anticipated by Scope that the Deputy Minister of Economy, José Luis Daza, is in Washington since Monday with the Secretary of Finance, Pablo Quirno participating in the first program review. Kozack said the conversations are “Very productive”.

The spokeswoman also admitted that the Staff Report has not yet been completed that will rise to the Board of the Agency and did not venture any date of conclusion or when the next disbursement could occur.

He recalled that a technical mission of the IMF recently visited Buenos Aires – concluded on June 27 – within the framework of the first review of the facilities program extended for US $ 20,000 million that the country signed last April.

Kozack said “The discussions for the first review continue, and remain very productive“He added that” the program, as we have said before, continues to generate positive results. “In this regard, he said that”The transition to a more robust exchange regime has been soft. The disinflation process was resumed. The economy continues to expand. High frequency indicators suggest that poverty is in a descending trend in Argentina. ”

The spokeswoman He pondered the country’s return to international credit markets for the first time in seven years And he said that “all this progress, of course, under the program, is sustained by appropriate fiscal and monetary policies”

BCRA reserves

On the issue of the accumulation of Kozack reserves, he said: “As I mentioned the technicians (of the IMF) and the authorities (Argentines) have a shared commitment to the success of the program and what I can add, of course, that it includes the shared recognition of the need to continue building reserves to protect themselves against possible external risks. We are closely committed to the Argentine authorities with this issue ”. On the other hand, the spokeswoman of the Fund refused to speculate on the possibility that Argentina requests a “Waiver” (forgiveness) for breach of a goal.

He was also asked about the decision of the Judge of New York, Loretta Preska condemning the country to pay 16,000 million dollars in a trial for the expropriation of the YPF company and ordering to deposit 51% of the shares of the oil company in the possession of the Argentine State as a guarantee. Responded in this regard that “Obviously we are paying close attention, monitoring the situation. However, by politics, we do not comment on legal issues related to our member countries. ”

Compliance according to the IMF

Argentina complied with almost all the goals established in the aforementioned agreement. In some cases in excess, as with the fiscal objectives. It should be remembered that the government of Javier Milei, on its own initiative, raised to 1.6% of the gross internal product the primary surplus goal in the treasure accounts. This is the most important fact for the conduction of the Treasury Palace that insists on the unnegotible nature of fiscal discipline.

The goal of accumulation of reservations held by the Central Bank, on the other hand, was not reached, according to different private consultants. It is estimated that the country would be $ 4,000 million below the objective.

In parallel, the payment balance data that ignited yellow lights among analysts were disseminated, so it is considered a rapid growth of the imbalance in the current account.

From the Ministry of Economy they refute these arguments. According to the holder of the portfolio, Luis Caputocurrent red equals 1.8% of GDP, far from the 4.8% that registered in 2017 the administration of Mauricio Macri and significantly below the imbalance in the current account that showed other countries that had a balance of payments. Among other cases, Caputo cites the situation in Chile, in 1982, when red reached 9%, Mexico in 1994 (tequila effect) with a 7.8%or Greece deficit, in 2008, with 14.7%.