How are the reservations coming?
. – They rise very slowly, what happens is that the government fell into the trap of the trap itself. Who wants to invest in Argentina, is not going to bring the dollars through the Single and Free Exchange Market (MULC) at $116.0 when they can enter it at $206 for the Cash Dollar with Liquidation.
Do you say that the CCL dollar is offered?
. – Correct, as is the market guide, since the Cash With Settlement dollar is offered, this significantly influences the price of the blue dollar, which is very calm at the moment.
What should we see for the blue dollar to rise?
. – In the first place, that the Cash With Liquidation dollar get out of control, something that does not happen today, secondly, an unbridled emission and, thirdly, a surplus of pesos in the market players. In the current situation, none of that happens, therefore, the dollar market will continue on its lateral path.
Is the Treasury taking pesos out of the market?
. -She is a vacuum of funds, in May she could go in search of $ 900,000 million, and maybe something else will take. It is validating rates higher than 50% per year at 180 days and this affects the liquidity of the market. Official banks are buying bonds and helping to dry up the peso market.
Do you have the financial data as of April 30?
. – Of course. The reserves are located at US$ 42,007 million, we are asking for the time. The Central Bank’s debt measured in dollars amounts to US$45,544 million, when this happens it is dangerous, because we are forcing the march.
How is the monetary base relationship versus BCRA debt?
. – I’ll explain it to you in numbers, the monetary base is $3,509,534 million and the BCRA’s debt in pesos (leliq plus repos) is $5,251,780 million. When this happens there is a problem at the door. The excess liquidity of the system is absorbed by the Central Bank itself and pays rates of 47% per year, it is like hiding the earth under the rug.
What would the equilibrium dollar be?
. – If we take the reserves, which are at US$42,007 million, and the total monetary liabilities that add up to $8,761,314 million, the equilibrium dollar is located at $208.6.
How do you see alternative dollars?
. – Both the blue dollar, Bolsa or CCL, are at attractive prices. It must be taken into account that the solidarity dollar is located at $200 and the balance dollar at $208, the alternative dollars are trading between both values, we believe that it is a super offer price considering the values that it could have in order to anus.
How is inflation coming?
. – I think they’re making us a price. In 2021, the exchange rate rose 1.0% and inflation was around 3.5% per year. Today with a rise in the exchange rate of 3.9% in the month of April, if we have an inflation of 6% they are making us a price.
How do you see the evolution of inflation?
. – I think we are going to maintain a floor of 4.0% per month for a long time. Argentina is not competitive to export, there is no investment, it does not increase productivity, and the rise in structural costs and supplies has an impact on unit costs, this leads us to reformulate price lists every month and inflation is recurring every time higher.
Did the rate rise in the United States?
. – This has a dramatic impact on the price of American stocks. Companies in the United States are heavily indebted, so this will affect corporate profits. On the other hand, the value of a company on the stock market is obtained by projecting future cash flows, discounting an interest rate. If the interest rate rises, the flows are discounted with a greater discount and this impacts the value of the company and therefore the share price.
How do you see Brazil?
. – With two-digit inflation and the short-term rate at 12.75% per year. For now, the real has devalued very little and has returned to levels above 5 per dollar. The presidential race in Brazil puts more noise on the economy, the winner will be revealed on October 2 and will surely have an impact on the local economy. For now and only for now, Lula is leading, but Bolsonaro is growing, we will see what happens.
Conclusions
. – We continue in a scenario of shortage of dollars in the reserves of the Central Bank. Investments are entering the alternative dollar market, which is why the blue dollar remains very calm.
. – The Treasury is financing itself in the capital market and, by not resorting to issuance, it leaves the dollar’s rise without fuel.
. – The long list of tax deadlines between May and July places a temporary ceiling on the blue dollar.
. – The rise in rates in the United States would generate a negative impact on the stock indices of that country and on the currencies of the region. Let’s hope it doesn’t go too far.
. – The crisis within the ruling coalition brings a lot of noise to the economy, but for now, and only for now, the income of dollars from the harvest, plus the collection of taxes, give the Treasury a breath of fresh air . For the second half, tighten your belt, because the dollar could take off looking to travel to a higher altitude than the current one.
Economic, financial and business analyst, lecturer, researcher and private consultant.
Source: Ambito
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