Together with devaluation of the official exchange rate, which began to quote $350 until October 22, the Central Bank (BCRA) arranged a rate hike of the 30-day deposits in pesos after the result of the primary elections held last Sunday. This happens in the middle of the uncertainty experienced by the markets after the good results obtained by the candidate of La Libertad Avanza, Javier Miley.
In line with that measure, it was also resolved raise the monetary policy rate (including the fixed term traditional) in 21 percentage pointsuntil the 118% (Annual Nominal Rates, TNA)which is equivalent to a 209% in effective annual terms (TEA) and a monthly effective yield of the 9.7%.
in dialogue with Ambitthe analyst of F2 Financial Solutions, Andres ReschiniI affirm that “this rate rise with devaluation point to improvements on the side of the exports to achieve reserve accumulationalthough there are many doubts about the success of this new scheme”.
This decision taken by the BCRA affects the cost of financing for productive and consumer sectors. Since any increase in active rates (deposits) has its immediate correlate in liabilities (credits).
Besides, Reschini considered that this measure “will affect the activity morewhich came with high levels of state involvement in total credit and to which rate hike doesn’t help“.
For his part, christian butelerpresident of Buteler Servicios Financieros, told Ámbito that “activity it’s coming very hit by the effects of drought and, on top of that, you have the rate hike.” And he added that this measure aims to contain the flight to the dollar by deposits, but that may have little effect on the exchange rate since “there comes a certain point at which the rate hike ceases to be as effective as it generally is in the economy when you come with a regime of high inflation and you keep broadcasting“.
Changes for productive credits
In this way, through the Communication A 7822 from the BCRAit was arranged that the investment project financing agreed as of this Monday will operate with a fixed annual nominal rate of 97%.
Meanwhile, in the communication it was determined that it will also be replaced by 109% fixed annual nominal the rate provided for the rules on “Line of financing for the productive investment of MiPyME”which includes working capital and special financing”.
It is a program through which credits to Micro, Small and Medium Enterprises (MiPyMEs) which allows access to financing with subsidized rates for projects of investment and to finance working capital.
According to the norm, the financial entities they must maintain a financing balance inside this line that is equivalent, at least 7.5% of your deposits of the non-financial private sector in pesos, calculated based on the monthly average of daily balances as of September 2022.
This measure is aimed at stimulate production of the sector as a way of contributing to the economic development Yet the employment generationso it points to the acquisition of capital goods; the construction and/or adaptation of facilities necessary for production I marketing of goods and/or services; and the development of a new product.
Source: Ambito
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