DNU and impact on the dollar, pocket and markets: what the City gurus think

He Government of Javier Milei declared an economic emergency for two years and issued a Decree of Necessity and Urgency (DNU) that deregulates the economy and impacts all aspects of the economy. economic and financial life of Argentina. The initial reaction of the markets was positive and the City gurus are beginning to give their first impressions of these measures. How do they impact the dollar, the marketshe pocket and the economy?

Elena Alonso, market analyst

“The repeal of the rental law seems to me to be affect the tenant negatively because it will be at the mercy of the owner. The reduction of the Gondola Law, Price Observatory and the Supply Law are other measures that directly affect the pocket and, although that can generate more competition in the long term, I think it will immediately generate a strong price increase. Therefore, I believe that this should have been taken more gradually in the current delicate context regarding inflation. For me these are the measures that most affect the pockets of people and economic dynamics“.

Andrés Reschini, analyst at F2 Soluciones Financieras:

“My impression is that the Government is doing what it promised during the campaign. More shock measures. And although I have not yet seen it in detail, he poses profound reforms in many aspects of the economy. For now, I do not think that the measure will have a strong impact on the dollar and exchange rateswe would already have news if it made the market nervous and that did not happen, but, on the other hand, I do consider that the issue of Release of tariffs may have a short-term impact on inflation“.

Salvador Vitelli, analyst at Romano Group:

“I consider that the news They are positive for the business and entrepreneurial sectorso they have upward impact on stocks and bonds, as we are seeing. In dollar “I do not see a direct impact so far, but I do believe that, in economic and financial matters, the Government’s measures are towards the deregulation of relations and the lack of state intervention within the will of individuals.”

“A paradigm of that seems to me to be the repeal of the Rental LawWhat freedom in the contract negotiation. Also important is the modification of the Civil and Commercial Code that allows trading in any currency of choice. “That encourages economic activity and I believe that, moving forward, after the crisis we are going through, we can emerge with strengthened activity.”

Christian Buteler, market economist:

“I think that deregulations are positive for economic and financial life, but what I do not support is that decisions pass only through the hands of a single power, the Executive. It doesn’t seem right to me that the president promulgates the laws, modifies them and does everything to his liking. I think that Everything has to go through Congress and be analyzed law by law, democracy is like that. In economic matters, for example, I think it is good repeal of the Rental Law, for example, because I think it will generate more supply. Now, that clubs can be public limited companies I don’t see it as necessary at this moment, for example.”

Salvador Di Stefano, business and financial advisor:

“The decree seems good to me because encourages economic and financial activity, but I think there are risks of political viability and that it could clash with Justice. That can complicate governance, but we should not get ahead of ourselves. The economy was effectively regulated, but beyond some specific cases, it is good for me that progress is being made in that sense. The problem that I see that will have to be resolved is the legal vacuum that remains due to the replacement of the laws that are repealed.”

Camilo Tiscornia, director of CyT Economic advisors:

“It seems to me that we have an economic emergency situation that requires quick attention and that the decree seeks to modify. As for the substance, I think it deals with a lot of things, but I am in favor of eliminating a lot of regulations that, although initially well thought out, end up interfering in economic activity and trigger mechanisms of corruption and obstruction“.

“On the other hand, with regard to the modification of the Civil and Commercial Code which aims to “ensure that obligations contracted in foreign currency must be paid in the agreed currency”, I believe that the objective of this measure is to reinforce the idea of coin competitionmaking it impossible to return or cancel debts in foreign currency with pesos at an exchange rate that favors the debtor.”