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Dollar down and a boldness of Martín Guzmán that revives Domingo Cavallo


The Economy Minister set a wholesale dollar price for the end of the year. The risk of currency delay reappears.

Daniel Fernandez Canedo

02/13/2021 3:33 PM

  • Clarí

  • Economy

Updated 02/13/2021 3:40 PM

Without the vehemence of former minister

Domingo Cavallo

, but with the same assertiveness, Martín Guzmán accurately anticipated the value of the dollar at the end of the year.

Cavallo, father of the convertibility plan of April 1991, defined what became known as the


, that is, a dollar would be worth a peso ... forever.

Time did not agree with him, but many years later his colleague Martín Guzmán decided to assert in the week that in 2021

the wholesale exchange rate would depreciate 25%

and that by the end of the year the wholesale dollar will cost $ 102.40 ( It is at $ 88.54, that is, it would rise 15.6% in the remainder of 2021).

All audacity


very few ministers would dare to do so much in a country with such high inflation.

The certainty, which also comes into dispute with the remanida


whoever bets

on the dollar loses"


Lorenzo Sigaut

in 1981, represented, however, an important change for Guzmán and a repositioning within and outside the Government.

By saying that the "depreciation" of the exchange rate would be 25% until the end of the year, the minister set aside his commitment that

the dollar would rise at the rate of inflation

and laid the foundations for a scheme to "anchor" the dollar. in an attempt to contain inflation.

Annualized, the 4% of January gives an inflation of 60%, well above the 29% consigned in the Budget, and that was the main reason for the attempt to anchor the dollar to contain the export prices of grains and meat in the year electoral.

In recent days, Guzmán played the role of being in charge of aligning the main economic variables with his sights set on the October legislative election.

He defined a value for the dollar that could lag behind inflation, confirmed that in his vision wages would rise above the variation in prices, around 30%, and won applause from important businessmen defining the causes of Argentina's high inflation in a way that is very different from that of the rest of the Government.

While President Alberto Fernández treated agricultural producers and merchants as speculators, and placed them as the main responsible for the growth in the cost of living, the Minister of Economy made a very different diagnosis.

It was enough for him to say that the country's inflation is multi-causal, that it is due to

"macroeconomic imbalances"

and that it is necessary to aim to balance the fiscal deficit and reduce emissions, to win applause and change the tone of the dialogue with businessmen.

Will Guzmán's vision prevail over that of the rest of the Government?

The answers will be known in the coming days and are probably not categorical, but some were anticipated.

A new anchor for the dollar changed the face of the market and especially with the fall in the rate for operations in the dollar futures market.

In this segment, many of those who bet that the Central Bank could not keep the rise in the currency limited, lost.

The futures rate fell 10 points in two weeks

making it clear that now the bets are on a lower dollar and the idea that the Guzmán-Pesce tandem will be able to control the price of the currency in the short term.

Another clear answer was that on Thursday

the Central Bank bought US $ 200 million

, an amount that it had not been able to obtain for a long time and that would have been the result of the sales of grains withheld by producers or exporters who were waiting for definitions on whether the President Fernández would or would not raise the withholdings.

Between the announcement that the withholdings would remain the same, and the new scheme of putting a foot on the dollar to slow the rise, leaving aside the exchange rate indexation, the market showed another tone.

One of the central doubts of the operators is how will Guzmán get the dollars that will allow him to sit for a while on the wholesale rate.

Could it be that you bet that with soybeans above US $ 500 per ton, the income of foreign exchange for the second quarter will be fluid and is assured?

You're probably thinking of a combination of a higher inflow of dollars from good global grain prices with a smaller outflow by cutting import payments and, of course, betting on some kind of deal with the International Monetary Fund.

Kirchnerism's unofficial spokespersons say that Vice President Cristina Kirchner wants a 20-year loan to be negotiated to meet the

US $ 44 billion

due in 2022 and 2023.

It is based on the idea that the IMF would have to give an

exceptional term

to cover what was an exceptional loan such as the one granted to Mauricio Macri.

It is from this unwritten claim that the idea grew that an agreement with the Fund would remain to be negotiated and closed after the October elections.

The vice president does not want to talk about fiscal adjustment or the need to increase public service rates significantly until November.

What will Alberto Fernández and Martín Guzmán say?

Until now, the Government appeared aligned in the understanding that a quick agreement with the IMF would be the indispensable step in the attempt to open some door of external financing to the Government to try to lower a little the enormous interest rate that Argentina pays for its debt .

Argentine bonds are worth around US $ 35 for every US $ 100 and offer a

17% annual rate in dollars


An outrage that, perhaps, the policy of putting the dollar back a bit can ease in the short term.

In the long run, as the prestigious economist John Keynes said, we will all be dead and that common place seems to be the one now embraced by the Government.

Source: clarin

All business articles on 2021-02-13

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