The message really appears clear. Trump’s support (via the treasure) remains intact and strong and, therefore, this political support is imposed on any technical analysis, prioritizing the political need to reach October in the best possible way. That includes forcing the rest of the directory to accept disbursement for US $ 2,000 million.
Like so many times, when the background needs to do a political favor, it seeks an “ingenious” way to do it. In this case, he granted the Waiver without his reservations, reformulated the future trajectory of them until 2027 and, to avoid new uncomfortable discussions, He decided to postpone any review until 2026. And as if that were not enough, in an excess poetic license, the staff affirms that Argentina has “Recovered access to markets” with the excuse of a timely placement of bonds and the repo with the BCRA.
These are the traditional “bureaucratic” strategies of the IMF when it has the mandate to facilitate life to the government on duty (for a while). When he wants the opposite, instead, they observe you to the deficit in Antarctica.
Thus, the government seems to have won a greater margin to intervene in the exchange market – when the dollar touchs the band or even before – operating in futures, improvising a transitional monetary policy with some aggregates, some rate, and until certain fiscal licenses that help improve the primary result, such as accumulating floating debt.
What then does this review imply?
It seems to me that in substantial all this is a subtle message that, after the elections, the entire agreement will be fully rediscusted. This includes the disbursements that are missing to arrive at $20,000 million promised (there are still US $ 6,000 million) and even some impact of the maturities corresponding to the previous agreement that allow a calendar of debt payments that today appear impossible to face.
It is also very likely that the IMF has demanded the typical internal re -laughes of a reserved nature that are made through a commitment of the minister and the governor of the BC exclusively with the Executive Directorate. Without these being published for market reasons. These commitments usually refer to key aspects of the program.
For example: 1) Request prior authorization and set limits to the use of the dollar of the fund to intervene in the spot dollar market. 2) Commit the government to be carried out in the post -election period prior to the January review all the necessary efforts to reduce current account deficit deviations through a more appropriate exchange and monetary policy. 3) Promote immediately post-elections the structural reforms committed to the agreement and of which the government so far did not discuss.
Is all this?
Yes, the alternative was not to grant the disbursement or impose unpaid reserves goals with this rate of exchange.
Will this convince markets?
Hardly. Especially in Wall Street, I think most understand that it is a transitory agreement, and that the true discussion – and the true program – will appear only in early 2026, with the exchange rate occupying the center of the scene.
Source: Ambito
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