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The rise of the blue dollar: there is a reason that nobody prefers to talk about much

2021-04-30T06:28:39.642Z


Soy continues to bring good news to the Central Bank. Reserves are growing, but the market is looking towards the end of the year.


Daniel Fernandez Canedo

04/27/2021 7:36 PM

  • Clarín.com

  • Economy

Updated 04/27/2021 8:18 PM

The blue dollar

touched $ 159, rising 11.2% in one week

and awakened the situation of exchange rate placidity

in which it came from the beginning of the year.

The movement of the parallel dollar shakes the waters despite being well below the $ 195 of October 23 of last year and that most analysts bet on a Central Bank

with margin to control

any possible overflow of the market.

The

high price of

soybeans and corn

in the international market, around US $ 560 per ton the first, added about

US $ 2 billion

in recent weeks to the value of this year's harvest.

The Central Bank increased net reserves by US $ 1.75 billion between March 1 and April 16, showing that

the field dollars are flowing in.

Although nothing is written, the high price of soybeans in the heat of increased purchases from China puts producers and exporters on alert.

They are suspicious of the government's temptation to raise retentions and more in times of pandemic and on the verge of deciding

restrictions on circulation

that would affect economic activity.

One of the questions to be asked is

why the blue will have woken up

if the income of dollars from exporters is fluid and the Central Bank is experiencing the golden quarter in terms of currency settlement.

The decision of the

investment funds Templeton and Pimco

to sell Argentine bonds for more than US $ 600 million and buy the currencies to deposit them abroad

moved the market.

The blue dollar rose 11.2% in one week, a warning sign.

Photo EFE

The departure of great players always

leads to think that they know something that the rest do not know

and turn on the warning lights.

The idea that the government

will not reach a solid agreement

with the International Monetary Fund in the three years remaining in its mandate finds few official arguments to refute it.

Inside and outside the Government, it is also accepted that the US $ 9,000 / 10,000 million of additional income from this agricultural season will have as its main destination to

consolidate the exchange rate

rather than loosen it.

Keeping the dollar

steady

is

an important asset in the attempt to somewhat stabilize prices

and even more so when the idea grows that the main objective of the ruling party is to

win the

year-end

elections

.

The government took note of people's concern about inflation.

The 4.8% increase in the cost of living in March was a blow to the expectations of families who now return to face the specter of restrictions to go to work.

That jump in inflation had already led to

Martín Guzmán to announce that he will delay the price of the dollar in an attempt to mitigate the rise in food, but the path traveled by the INDEC indexes ended

with the official objective

that this year wages could beat inflation.

The original government scheme was an inflation of 29%, with the dollar rising 24% until December and with a 30% rise in wages pointing to some recovery in consumption.

One problem is that the goal of 29% increase in the cost of living included in the National Budget

collapses shortly after setting sail

(inflation for the first four months would already be around 16%) and the possibility of

a real increase in the population's income is in a flimsy situation.

In Argentina the

wage bill

is determined by about 30 million people who receive income.

In it, 19 million are employed (formal, informal, monotax employees, etc.) and there are 11 million people among retirees, pensioners and beneficiaries of social plans.

The increase for retirees of 8.07% for May, June and July runs behind inflation

, which was already 13% in the first quarter, and that is why the Government gave a bonus of $ 1,500 for those who receive the minimum.

Without this bonus, which they would collect in April and May, there would be about 3.5 million retirees, who are those with the highest salaries, who

would lose in the face of the rise in the cost of living,

 with which they can hardly contribute to improving consumption .

The populous trade union, led by Armando Cavalieri, closed a 32% parity.

Photo Marcelo Carroll

The parity companies, for their part, round up increases of 30% (Commerce closed at 32%), compared to the inflation forecasts of economists above 40%.

On that side, it does not seem that the

demand

can "pull" much and even more in the face of the panorama presented by the pandemic, which would lead families to be extremely prudent in spending.

The financial side of this reality is that

part of the savings is turned over to bonds or deposits indexed by UVA

(retail inflation) in an attempt to protect the pesos from inflation.

And that

part of the income from soybeans goes to the blue dollar

in the understanding that financial stabilization has an

electoral sense

for the Government

and, therefore, a portion of the dollars that come in through exports

go out of

distrust

.

And nobody wants to talk about it much.

Finally, and to look the other way, the Central Bank, which already accumulates many

 pesos

by placing liquidity bills in the banks (before the Leliqs were questioned),

is forced to keep the rate low

 to avoid the disbursement of another mountain pesos for interest.

 With high inflation, a low interest rate scheme for deposits in pesos, and the promise of an exchange delay, stability problems are always faced.

And blue is usually a wake-up call.

Look also

One year after the first offer, Axel Kicillof seeks to improve the proposal to bondholders

Martín Guzmán: "Getting vaccines against the coronavirus is the best economic policy"

Source: clarin

All business articles on 2021-04-30

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