In turn, the MEP dollar fell 92 cents (-0.3%) to $292.41. Consequently, the spread with the official reached 91.4%. Since last Friday, he accumulated a decrease of $7.08 (-2.4%).
Why the financial dollar falls
“weights are missing”operators agree when it comes to attributing the causes of the drop in financial exchange rates. “We see that the monetary adjustment, via rate hikes and absorption with Leliqs and repos, is drying up the market and slowing down the demand for dollars”describe in the market.
The Central Bank placed on Tuesday almost 1 billion pesos ($986,509 million or about US$6,455 million) in Leliq, with an expected return of 75% per year at 28 days. The operation resulted in a contraction of $163,077 million, against maturities for $822,975 million. Let us remember that the BCRA board left the rate unchanged last week in the 75% annual nominal given the prospect of a slowdown in inflation (in September it was 6.2% vs. 7% in August).
Also this Wednesday the BCRA placed another $14,150 million in Notaliq with a 182-day term with a stable rate, while the entity declared the Leliq tender void for the same period. The yields offered were 83.5% per year for the Leliq and a spread of 8.5% for the Notaliq.
“News of a slowdown in inflation in September combined with interest rates close to inflation seem to be weighing on financial dollars. Likewise, liquidity needs in December may also be a factor in favor of stable interest rates.” change as the end of the year approaches,” explained from Delphos Investment.
Although in the accumulated figure for October, the Mutual Funds industry (FCI) registers net bailouts in all types of FCI (money market, CER, dollar linked, T+1, etc.), in the last three rounds the net subscriptions to the money markets returned. In the same period, in turn, the surety also increased the volume traded and, consequently, already compressed yields.
In this sense, John Paul Albornozan economist at INVECQ, told Ámbito that “The pesos are going to rate non-indexed assets such as money markets, or guarantee against a possible lower expectation of devaluation in the very short term, thanks to a Central Bank that got air in terms of reserves for a few months thanks to the soybean dollar” . In any case, he warned that this measure has a cost “of a deterioration in equity” and, more importantly, it gave “a bad signal for the future supply of foreign exchange, opening the door to new sectoral exchange rate incentives when the outlook for reserves becomes more pressing.”
On the other hand, Albornoz attributes the exchange pax to a “Greater demand for pesos to pay taxes, such as the advance payment of Profits.”
Outside the local situation, in the market too link the decline of the CCL and MEP with the decline of the US currency in Brazil between Monday and Tuesday.
“Free dollars are down and are again quite far from the inflation accumulated in recent months. Since the end of 2020, inflation has been 152% and free dollars have grown between 74% (blue) and 110% (CCL)”, they limited from Aurum Valores.
Global Focus Investments analyst Mauro Cognetta warned that “For now, the issuance of $1.2 trillion has not had an effect for what was the soybean dollar in September, plus other monetary faucets from the BCRA to buy securities. With which, this at some point will have an impact on the dollar free”. “Today the theoretical reference price of the CCL is $345”estimated.
In the informal market, and unlike the trajectory of financial exchange rates, the blue dollar climbs $2 to $292, according to a survey by Ámbito. Thus, it is equated to the MEP, something unprecedented in the last month.
At the beginning of this week, the so-called Import System of the Argentine Republic (SIRA), which replaces the Comprehensive Import Monitoring System (SIMI), a mechanism by which the Government it seeks to restrict the sale of foreign currency, which, in the opinion of business chambers, may lead to insufficient supplies being obtained to produce.
“The new authorization system to access the market again compressed the demand for dollars, allowing the monetary authority to absorb the excess available in the wheel”, said Gustavo Quintana, operator of PR Corredores de Cambio.
The monetary entity managed to buy about 21 million dollars from the market on Tuesday through liquidity regulation operations, which are added to the 23 million purchased on Monday, although so far this month the balance is negative for its reserves by about 250 million dollars. “The beginning of the new obstacles to imports brought good news for the monetary authority, although we believe that it is a short-term effect,” they estimate from PPI.
In the first tender of the month, the Ministry of Economy obtained $181,251 million in the first tender in October and obtained an extra close to $17,000 million since it faced maturities of $164,502 million. In this tender, 3 titles with maturity in 2022 and 2023 were offered. As officially reported, 1,013 offers were received, representing a total of VNO $192,874 millionawarding an effective value of $181,251 million.
“Despite the fact that the maturities do not seem challenging a priori, the fact that the CER curve (bonds tied to inflation) yields positive throughout 2023 at the latest market prices makes us pay attention to the level of rates that the Treasury ends up validating”they maintained from the SBS Group.
Source: Ambito
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