The president of Byma highlighted the change of government logic and explained why the floating dollar policy can mark a turning point. He warned that Argentina must discuss structural reforms to sustain the new scheme.
Three weeks after Exchange Standingthe market continues to adjust to the new administered flotation regime promoted by the government of Javier Milei. With a Official dollar that moves between $ 1,000 and $ 1,400 and a free exchange rate that begins to converge, Claudio Zuchovicki, Flaming president of Argentine stock markets and markets (Byma), analyzed the impact of the new monetary policy and left a key warning: “The price (of the dollar) conditions our opinions. But that has to change.”
The economist and financial analyst stressed that for the first time in years The dollar begins to function as one more variable within the economy and not as an emotional anchor or a score of social humor. “Our cultural battle against ourselves has to do with this dollar cycle, as a mood brand,” he explained.
The new role of weight in the floating scheme
Zuchovicki explained that the key to the new model is the administration of the monetary base. “What they manage is not the price of the dollar, but the amount of pesos that are circling”he said. And added a practical example: “If everyone goes with pesos to buy dollars and they have to sell them, you hurt. But the next day you need to sell dollars to pay expenses or salaries. So it works now.”
In addition, he recalled that the exchange band will adjust: the floor will fall by 1% monthly and the ceiling will rise in the same percentage. “It is widened until you get used to living floating. You don’t need to mark the dollar every day. It’s another variable,” he said.
A change of power: the consumer in command
Zuchovicki also analyzed the impact of inflation and how the loss of purchasing power not only limits the purchase of dollars, but also of essential goods. “When the dollar goes up, the meat, milk, clothes, what we do not understand is that it is not just that you cannot buy dollars. It is not enough for you at all,” he said.
However, he remarked that there is a deeper transformation in progress. “Until now, the power had the one who had the merchandise. You wanted to get the weights off you and the merchant did not sell because he did not know if he replied. Today there is an overstock. The power has the consumer,” he said.
The coming challenge: structural reforms
In dialogue with The observer, dE face to the future, the president of Byma was emphatic: “Argentina has to discuss taxes, labor rates, contributions, intermediation. You have to talk about structural reforms that make you more competitive.”
The new exchange scheme opened a window of opportunity. But for Zuchovicki, take advantage of it will depend on the country progressing with deep changes. “The model needs stability, but also incentives to produce, export and invest. It is not enough to order the currency,” he concluded.
Source: Ambito
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