The scarce net reserves held by the central bank (BCRA) remain in the center of the financial eye, since importers are concerned about the cut in supplies for the normal development of the economy.
Analysts consider that the daily sales of dollars that put pressure on the coffers of the monetary authority put more pressure on the weakened domestic exchange rate, in the face of projected inflation of 100% by 2022 and a complex fiscal deficit. According to estimates, The coffers of the Central Bank could stop receiving 3,000 to 5,000 million dollars in agricultural exports due to the harsh drought that has hit the humid pampas and unusual frosts in the producing areas of the Andes.
“The problem now is the dollar cut that imports need,” said economist Miguel Kiguel. “The level of (net) reserves is around 4,500 million dollars, just for about three weeks of imports. It is a very poor level (…) when to function well, it should be 10 times more than this figure,” he added.
In the midst of a difficult liquidity scenario with a cut in the purchasing power of wage earners and more among the indigent, the Government launched an expected debt swap to clear clouds in the last two months of the year.
The proposal of Ministry of Economy with the voluntary debt swap for bondholders maturing in November and December of this year is to give others with amortizations in June, July and September 2023, through the operation for about 1.5 billion pesos (about 9,371 million dollars ).
The Treasury is betting on extending maturities between seven and 10 months with the announced debt swap, at the cost of once again offering instruments that offer the highest yield between the devaluation of the official exchange rate and inflation.
“We expect a high participation from official entities (with the voluntary debt swap on Thursday) and to a lesser extent from institutional investors and banks,” limited a financial agent.
Javier Timerman, a partner at Adcap Grupo Financiero, stated that “in an economy with a foreign exchange trap, the Government is on the path of offering instruments with inflation and dollar coverage, but they are transitory solutions (…) We have to start thinking about medium-term solutions, because unrest is created by appealing to the local debt market”.
S&P Merval and ADRs
For its part, the S&P Merval falls 0.22% to 147,596.74 points against its intraday historical maximum of 154,031.5 units recorded at the beginning of November.
“The upward trend, which began at the end of June this year, seems to have weakened and the Merval index has been lateralizing between values of 150,000 and 136,000 points since September, which could be an intermediate lateral trend lasting two months,” said Mauro Natalucci of Rava Bursátil.
Argentine papers listed on Wall Street fall up to 4% stressed by the external context, led by YPF, followed by Transportadora Gas del Sur (-3.5%), Cresud (-3.5%) and Loma Negra (-2, 9%). The only two rises of the day were recorded by Central Puerto (0.6%) and Corporación América (0.4%).