The markets initially react to the announcement of new measures to simplify the exchange regime and obtain two disbursements from the IMF for this second semester, in the midst of the complex electoral panorama.
The bonds in dollars operate with increases this Monday, July 24. It does so after the Government and the International Monetary Fund (IMF) reached an understanding this weekend to advance in the review of the Argentine program and obtain the disbursements scheduled for the second half of the year.
Through a joint communication, via social networks, both the Argentine authorities and the agency reported that “the teams of the Ministry of Economy and Central Bank of Argentina and the IMF Staff have completed the core aspects of the technical work of the next review”. In this framework, the dollar titles register increases of up to 2.5%. Meanwhile, the actions of Argentine companies that trade in Wall Street they also moved slightly higher, led by bank paper, in the pre-market.
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Technical agreement with the IMF
Having laid the foundations for the reformulation, the final letter of the technical agreement would be completed in the next few days virtually between Washington and Buenos Aires. It is expected that you can meet the understanding towards Wednesday or Thursday of this week, according to sources close to the negotiation.
Communication via social networks recognizes the unfavorable conditions that the Argentine economy is going through as a result of the drought that reduced by about US$20,000 million income from agricultural exports. It indicates that the agreement “seeks to consolidate fiscal order and strengthening reserves recognizing the strong impact of the drought, the damage to exports and the country’s tax revenues”.
To reach an understanding, numerous efforts were made both by the delegation of the Ministry of Economy who traveled to USA as of the holder of the portfolio, Sergio Massa, that he was negotiating until late Saturday, as he learned Ambit.
In official media it is stated that the intervention of both the White House and the United States Congress was decisive in getting the talks back on track.
The agreement reached will immediately allow the unlocking of some US$4 billion in disbursements scheduled for the end of June and that were not transferred due to the country’s failure to meet the goals agreed upon before the impact of the drought. In the first half of the year, Argentina was unable to meet the targets for reserve accumulation, fiscal deficit, and monetary financing of the deficit.
The progress in the negotiation comes at a key moment since at the end of the month payments must be made for about US$2.700 million in a moment of external fragility.
Source: Ambito
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