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After a hot week, what can happen to the stocks and the dollar?


Miguel Pesce trusts that the tension will ease. The market, that the Government will add more regulations in order to avoid a devaluation.

Ezequiel Burgo

09/19/2020 - 22:57

  • Clarí

  • Economy

In 2001, Diego Maradona said something that many will have thought this week after the dollar announcements.

“This country is the same game that is played forty thousand times on a delayed basis at dawn.

You stay watching it and you know what will happen ”


After the Minister of Economy, Martín Guzmán, and the Deputy Chief of Cabinet, Cecilia Todesca, ratified that there would be no changes in the stocks, the opposite finally happened.

The question now is,

how is the dollar doing?

For the authorities, the measures will emerge effect.

Analysts, on the other hand, doubt.

They say that it will be important to see what happens from tomorrow in the market.

If you ask about what could happen if the reserves continue to fall, the answers are:

more stocks or doubling



Jorge Carrera

, economist and second vice president of the Central Bank, the new regulations will serve as a bridge between the current state of demand and supply of foreign currency, with the end of the year.

"The announcement came on time because the idea is to arrive in December-March, which is the peak season for dollar income,"

says the official.

With the demand and supply of dollars more stabilized, it would not be necessary to use reserves.

The bank nevertheless continued to sell dollars after the measures.

Carrera explains that the bet is to close the tap on the dollars that are leaving due to the cancellation of debt in foreign currency from private firms.

He estimates that in these months was a debt reduction firms

"for nearly US $ 16,000 million, equivalent to almost the

entire amount by which had borrowed between 2016 and 2019"


“They used soft loans in pesos, taking advantage of the Central Bank's lower rates to pay off loans.

We found it too fast-paced and generated a 12 ”Gate effect


The debt measure was criticized by economists.

"But a devaluation or a doubling of the exchange rate would worsen the outlook for the private sector,"

says Carrera.

“The companies should have valued their debt at $ 130, which would have been a significant equity problem.

Argentina has a problem of financial dollars, not commercial dollars.

The currencies appear in



When asked at the bank why the demand for dollars is regulated more than encouraging supply, Carrera responds that the entity encourages grain companies to borrow abroad via their parent companies.

It is a way of not exhausting the local credit supply (

crowding out


What will happen

if the reserves continue to fall

and the outflow of financial dollars (savings and to pay debts) is not enough?

Will it be decided to close the stocks more, no longer regulating the demand for foreign currency of companies to pay debts but, for example,

limiting foreign exchange for imports of non-essential goods for 60 days


Or directly, why not double the exchange rate?

The alternatives are opinionated.

“Splitting or more stocks?

Poison from the little blue tube or the little red tube? "

Lucas Llach

, former vice of the Central Bank

, tweeted


Martín Rapetti, on the contrary, recently explained in Clarín that he would be more in favor of doubling the dollar.

The Government stands before the dilemma with strategies that characterize



in Argentina.

None that have worked.

In the


, the government kept the fiscal deficit high with more financial repression and control of imports.

In the short term, the cost of increasing the gap rises, emission accumulates and the devaluation is only postponed by increasing the costs of exit.

In the


, the government had a fiscal deficit and the Central Bank sterilized the pesos to finance the Treasury.

This reduces the exchange gap but raises the cost of the final devaluation.

Today Pesce increases the remunerated liabilities of the Central Bank at a higher rate than Sturzenegger.

Finally, the strategy of the


, a more




This requires an initial exchange rate correction, followed by a control of public spending and an agreement with the IMF.

The scheme could add to a doubling of the exchange rate between the commercial and financial dollar.

"The government opted for the first one that implies not devaluing,"


Luciano Laspina

, economist and deputy for Together for Change.

“Between rising the dollar and the recession, they prefer the latter.


Because they will explain the recession due to the macro crisis and the pandemic, while if they increase the price of the dollar they are

game over


For us, on the other hand, the policies of Alberto Fernández and the quarantine lead to recession ”


Mercedes Marcó del Pont

said a few hours after the BCRA measures that

"this government is not going to devalue




Andrés Borenstein

, economist at the Econviews consultancy,

“the problem with the stocks is that you know when you come in but not when you leave, you have to have a lot of credibility like Mauricio Macri, for example, who lifted the controls.

The question is how this government will transmit confidence.

Another problem is that it generates noise in companies about debts ”


According to Borenstein, the advantage of this stocks would be that

"it stops the drain on the outflow of dollars for the payment of debts and then there should be more dollars to import



Fernando Marull

estimated that the measures could

lower the demand for dollars by US $ 1 billion


One variable that many economists and the market will begin to monitor will be

dollar deposits





As Maradona would say, the Argentine economy is the same party as always.

Source: clarin

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