In April 2025 there will be a devaluation of weight. It can even be established that the magnitude of the increase in the exchange rate will be in round numbers between 10 and 20 percent.
On the day in which they were going to devalue it, the weight rose at 5:30 in the morning on April 2025 to know if the increase in the exchange rate would be due to a jump of the price of the dollar established directly, by a jump towards a system of bands in which only the superior would be real importance or by a jump towards the free flotation of its drift price in which the national money could be shipped.
In this way Gabriel García Márquez could write The chronicle of a devaluation announced in Argentina governed by an expert in economic growth with and without money, in maintaining the stable exchange rate with and without reservations, and in specifying agreements with the IMF with and without agreement.
That’s how it is. Many times, in the field of the economy there are certainties of facts that will necessary to occur by economic law, in the same way that Newton’s apple fell by physical law. However, the difficult thing is usually to establish precisely when these facts will take place. In the Argentine case there is no uncertainty or doubts: In April 2025 there will be a devaluation of weight. It can even be established that the magnitude of the increase in the exchange rate will be in round numbers between 10 and 20 percent. It only remains to know which exchange system the IMF will impose to Milei and Caputo, and to what extent this first post of the exchange adjustment will be transferred at prices, whose second stage will be after the national elections of 2025.
BCRA: The waste strategy
The BCRA wastes reservations so that there are more dollars facing pesos and, thus, stepping on the exchange rate. And while the economic team observes the countdown with the reservation clock, every day that passes it has fewer dollars and, therefore, worse conditions to influence an agreement not yet agreed with the IMF, although its legal guarantee established by DNU and not by law, was no longer rejected in the National Congress.
According to the information available, whatever the imposition in the form of agreement established by the IMF, it will be in April 2025, for which an eternity is missing due to the pressure on the exchange rate manifested in the rhythm of reduction of BCRA reserves.
A few months ago, in this same medium and on this same subject, it was analyzed: “What the IMF asks The nationalization of external private indebtedness in Argentina, tried to bring positions to achieve the common objective: A first increase in the exchange rate quite before the elections in such a way of being able to reach that moment with “moderate” inflation and with lower exchange tensionsamong other measures.
In the same article, it was reasoned: “In 2018, it was claimed that the IMF could not give enough dollars to the Macri government in relation to the situation of then. They could not have approved the loan of 57 billion dollars for the amount, the statutes of the fund and the lack of endorse Geopolitics. They did not weigh the ‘macroprudential’ aspects. These types of debates and negotiations usually find their resolution – that is, that the crisis is postponed by changing form – when focusing on the priorities: at a time of fragmentation, growing disputes and tensions in the world, most likely it is that, after some modifications in the implementation of secondary objectives, the IMF again borrows the country and almost finished annexing it for only 10 billion dollars.
With the same scientific certainty that there will be a devaluation in April 2025, it must be concluded that the inevitable consequences of this economic model will continue to hit the caste of informal and formal workers, retired, small businesses and shops, and many large companies. It can also be deduced that the logic of the model implies that wells are favored as Donald Trump, Elon Musk and Larry Fink.
* Economist UBA-UNV.
Source: Ambito
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