In an attempt to slow down the escalation of inflation and stabilize the exchange rate, the Central Bank (BCRA) increased its reference rate ‘Leliq’ by 250 basis points, to 42.5% per year for a 28-day term.
“We are still waiting for the official statement of acceptance of the agreement by the credit institution and its subsequent debate in the Congress of our country. The agency and the Government would be finalizing the details to close the agreement“said Portfolio Personal Investments.
“The statements by IMF officials indicating that they are close to reaching a complete agreement with Argentina were a good sign for the market. In any case, it will also have to go through Congress to face the “political test”. Finally, each quarterly review will be an “economic test” where the doubts will be whether it will be possible to comply with the agreement or waivers will begin,” he explained. Robert Geretto, of Fundcorp.
“The Argentine debt appreciated by +5.35%, after the director of the IMF’s Western Hemisphere Department assured that the organization is close to reaching a complete agreement with the country, with meetings that have focused on three priorities : the fight against Covid 19, the monetary tightening cycle and fiscal sustainability,” said a Banco Mercantil report.
“The process of price formation in Argentina is maintained, showing significant inertia, pressures related to scarcity and the effect of financing from the central bank to the government,” said a Credit Suisse report and estimated that in 2022 “inflation is likely to be between 55% and 60%”.
In relation to the rates, from Delphos Investment they maintained that “The convergence to positive real rates is still challenging due to inflation levels around 4% per month in the coming months.”
“The new rate hike by the BCRA -on the way to positive real returns- together with the acceleration of the crawling-peg has enabled a stage of greater calm, as reflected in the balances of the last rounds”, concluded Gustavo Ber, economist at Estudio Ber.
Source: Ambito
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