These three variables will be tension during April. The possibility of a modification of the exchange regime within the framework of the new agreement with the IMF, will determine what will happen with the race between dollar, rate and inflation.
Since the Minister of Economy, Luis Caputo, He questioned the continuity of “Crawling Peg” 1%the coverage demand did not stop climbing: the future dollar uploaded, The exchange gap was expanded of the types of financial changes, and occurred A bleeding in the Central Bank reserves (BCRA). In parallel, although the interest rate is maintained, The Government must have the highest interest rates in the last tender of the Treasury. And finally, food inflation complicates the March index and generates doubts about the continuity of the disinflation process. In that context, it is that key to analyze how it could be The dynamics of the dollar, the rate and inflation in April in the face of exchange tension.
In the first place, it is important to rebel some known data in March. If the analysis is begun by the IPC It should be noted that in February, the last official published measurement, the index rose to 2.4%, and in regards to this month, the key will be how much will be the rise in food prices. In this regard, there are private measurements that place it between 3.1% and almost 4%. With this rhythm, The general inflation of March could exceed February data, and located between 2.5% and 3% or moreaccording to private consultants.
Regarding dollarthe contracts of futures They reheated in the last part of March. The deadlines of the months after the October elections rose about 2% last Friday, and the market awaits a monthly adjustment above 2.5%. As for the types of financial changes, they are aimed at closing the month above $ 1,300 and with gaps that do not fall from 20%. It should be noted that, in the last two weeks, they rose strongly: in the second of March, the MEP increased more than $ 15 and the CCL$ 20 and in the third of the month, Both shot up to $ 49.
“The interaction between the dollarthe rate and the inflation in April will be marked by the growing Coverage demand and the Electoral context. The pressure on financial dollars will continue to increase until the market knows what the exchange path will be after the agreement with the IMF, “he told Scope, Leonardo Anzalonedirector of CEPEC. And expanded: “On the prices side, Inflation remains high and any exchange or tariff adjustment could reactivate pressures that they are already being seen, on the side of expectations. “
IMF, dollar, and treasure tender
The same day the minister Caputo He held a press conference to announce that he asked the International Monetary Fund (IMF) a loan by U $20,000 million In order to increase reserves, Treasure He made his last tender in March in which although he could refinance 100% of the maturities in pesos that he had on the date, it was shown that there was a demand for bonds tied to the dollar and also had to validate higher rates, as they had been rising in the secondary market.
“In a context of high coverage demand, we are likely to see A narrow interaction between the evolution of the dollar and the interest rate In April. If the market perceives that the rates offered in pesos remain attractive enough to compensate for inflation and exchange risk, we could see some stability in the exchange rate. But If uncertainty persists and investors seek refuge in the dollar, this could generate greater rising pressure in the price, forcing the BCRA to intervene, either adjusting rates or selling reservations“He also said in a talk with this media, the financial analyst Gabriel Bagattini.
For his part, Anzalone added: “As for rates, The last tender showed greater bullish pressure, indicating that the market requires higher yields to stay in pesos. If inflation does not yield strong and everything seems to indicate that during the next months it will remain around the last values, This trend is likely to continue. ” And he closed: “In short, April will be a key month where the expectation of the markets will play a determining role. If the government manages to contain the exchange gap and keep attractive rates, you can gain time, but If the coverage demand continues to increase, the pressure on the dollar and the rates could climb. “
Source: Ambito
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