Started 2023: the 3 key factors for the markets in the New Year

Factor 1: Debt placement

But, with a longer-term vision, Buteler considers that “the main issue is the debt in pesos, which is a lot and is very concentrated until before the elections.” Thus, the economist points out that extending the maturities is essential for the Government and that the market will monitor very closely because it warns that this will not only have an impact on the government funding itself, but will also affect the dollar.

Eco Go economist Lucio Garay Méndez recalls in this sense that the Finance Secretary it will have to face a test twice a month during 2023 where it will test the expectations of the market and the willingness to finance the treasury. “How he does on each occasion reflects how much they believe him and how they feel the game will evolve. fiscal-financial programso they are all important,” he says.

And Buteler adds that, “if the market does not want, due to a lack of confidence, to renew its debt, part of those pesos that are not going to go there will put pressure on the exchange rates and they could trigger the gap ”, he warns. One cannot fail to mention also that a debt crisis with more pesos on the street it would accelerate inflation, as happened in the middle of last year, so it is a central issue going forward.

Factor 2: energy and commodity prices

That is why Garay Méndez considers that the gap It is “the high-frequency thermometer that instantly reflects what is happening in the economy.” And it indicates that two other factors that are going to be key this year are the international commodity and energy pricesfundamentally.

“The first has an impact on the accumulation of reserves, because it affects the field liquidations through the official exchange market. Between the drought and the drop in prices that we have seen so far, and with a backward exchange rate, the Central Bank is not going to have an easy time collecting foreign currency ”, he anticipates, on the one hand.

This is also what the economist Jorge Neyro considers, who points out that “the issue of drought and the consequent lack of currency supply that it can bring, that we still don’t know how big it will be”, is a central element to monitor for the markets as a short-term structural element.

And, on the other, Garay Méndez adds that the energy price It will be decisive for the Government to lower the deficit. In fact, he comments that a large part of the adjustment in the second half of 2022 was thanks to this, to the fall in spending on this resource and indicates that, “if this trend continues, it could make things easier for the Government in 2023”, both in both deficit and reserves of the Central Bank (BCRA).

Factor 3: IMF goals AND the elections as a backdrop

All of this is in line with what for Neyro is the central underlying variable that the market is going to look towards this year, and it is the fulfillment of the goals with the International Monetary Fund (IMF), which is something that is followed every month. month.

And he also adds that “the electoral factor It is something that will also mark the market”. Because he thinks that a change of political sign can be important to define the mood of the markets, which is going to evaluate the trends of the surveys.