He dollar It is usually one of the preferred instruments of savers when analyzing investment alternatives. investments and its bullish performance during 2024 seems at first glance to agree with those who opt for the US currency, but… how much difference was there with an instrument tied to the inflation in local currency, such as Indexed Units (UI)?
The UI is a unit of value that varies daily and is linked to the Consumer price index during the month immediately preceding the reference month, while the relationship between the dollar and the Uruguayan peso depends on different issues, which makes actual performance more unpredictable.
According to the latest survey from the specialized site Sherpa staff, The strength of the greenback in the last election year, close to 13%, led to saving in dollars being 0.9% more favorable than doing so in Indexed Units, although that does not mean that the account closes the same thinking in the long term. , especially if the depreciation of the North American currency in previous years is taken into account.
How each instrument fared in 2024
To explain the situation, Personal Sherpa used a simple example: a person who at the beginning of 2024 had 100,000 pesos that he sought to protect from inflation and in one case invested them in dollars and in another scenario in UI.
As values it took the value of the UI of the Central Bank of Uruguay (BCU), which on January 1, 2024 was 5.8743 pesos, while taking into account the value of the retail dollar of the BROU, which that day closed at 40.30 pesos for sale. In this way, the 100,000 pesos were enough to purchase 17,023 UI or 2,481 dollars.
Taking into account the December data, the UI was at 6.1695 pesos, with the adjustment to an inflation of 5.02%, while the US currency in the BROU had a purchase value of 42.70 pesos. Thus, 105,017 pesos could have been withdrawn if they had saved in UI and 105,955 pesos if they had invested in dollars.
In comparison, those who opted for the North American currency obtained a difference in favor of 939 pesos, a balance of 0.9% above the UI.
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Long-term comparisons
However, from Personal Sherpa they indicated that the result “was the product of speculation”, while they valued that “the UI eliminates uncertainty, ensuring that your savings maintain their purchasing capacity, regardless of fluctuations in the exchange market”, although they clarified that It is an effective tool to maintain the purchasing powerbut without the possibility of achieving real profits.
In fact, if the evolution is analyzed since the creation of the UI, on June 1, 2002, it shows the convenience of the instrument tied to long-term inflation, which obtained a 147% higher performance in its more than 24 years of operation. existence.
It is that, when comparing the performance of a Uruguayan who had 100,000 pesos in June 2002 and invested them in dollars or UI, the current return would be 249,708 pesos for the first and 616,900 pesos for the second.
What is expected for 2025?
Although it is clear that the UI is more effective to protect purchasing power, in this year’s economic scenario the market begins to send some signals about what may happen.
On the one hand, the dollar January began on the downside, with a decline of 1.87% in just over three weeks, although it is expected to recover ground as the President of the United States, Donald Trump, Start outlining your management plan.
At the same time, a higher risk “inflationary scenario” is on the horizon, according to the BCU itself, while different measurements anticipate a CPI close to the ceiling of the target range and even the expectations of some sectors begin to appear above 6%.
Source: Ambito
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