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Will the 'slap plan' of stepping on the dollar and issuing many more pesos work?


Struck by the defeat in the PASO, the Government sketches measures to seek revenge in the November election.

09/14/2021 18:51

  • Clarí

  • Economy

Updated 9/14/2021 7:58 PM

The level of


surrounding government officials is staggering.

Still in shock by the result of the PASO on Sunday, no one risks categorical opinions regarding what measures to take in the next few hours, with one exception: that of the head of the Central Bank, Miguel Pesce, whose main mission is to

take care of the reserves of currencies


The message that they emit from the Central is that

there will be no changes in the stocks, 

and that there will be dollars to continue with the current rule that what is imported is paid effectively.

In the Ministry of Economy, meanwhile, the tension is on the rise and although the minister knows that President Alberto Fernández is reluctant to replace him, he also knows that both Vice President

Cristina Kirchner and La Cámpora and Sergio Massa

are requesting his replacement.

The most forceful "support" that Martín Guzmán received to continue in his position was the criticism of his management from former vice president Amado Boudou.

The internal rift in the Frente de Todos began to take shape and the vice president remains silent.

In the Casa Rosada, they began to sketch

the 60-day plan or "slap"

that is part of those expected:

increases for retirement and

minimum wage,

and additional payments for the beneficiaries of the Universal Child Allowance, in

addition to the expansion of Now 12 and 18 consumer plans.

To this package is added the continuity of the exchange rate, with the official dollar growing well below inflation in an attempt to contain the rise in food prices and INDEC indices until the end of the year.

Although he would not have a back today to talk about achievements, Guzmán seeks to have it recognized that

2.5% of inflation in August

was the result of his policy of anchoring the dollar.

There a sensitive point is that, despite the fact that the Central Bank allocated more than

US $ 800 million

in recent weeks to reassure the market,

the gap between the wholesale dollar and the blue dollar remains at 85%

despite the favorable response that the market gave the result of the PASO on Sunday.

Although in a low voice, in the Government they recognize as an asset that the

triumph of the opposition

in the Primaries, unlike what would have happened if Kirchnerism triumphed,

transmits more calm than tension

to financial operators and the dollar.

In the cloud of uncertainty that exists in the Palacio de Hacienda, to the point that this Tuesday there were doubts about whether it would actually be sent

Budget 2022

to Congress in the next few hours, a certainty emerged with clarity:

the essence of

the 60-day plan will be a higher level of issuance of pesos

and there other doubts arose.

According to the limits established by the Organic Charter, there would be about

$ 800,000 million

in temporary advances that the Central Bank could pass on to the Guzmán Treasury until the end of the year.

This amount is important but, perhaps, it would

be insufficient

for the government's political needs, so the Treasury should resort to greater indebtedness in the domestic market (which has been elusive for the minister) or take other paths.

Economists focus on the extraordinary income of

Special Drawing Rights

granted by the Monetary Fund for the attention of the coronavirus pandemic and that Argentina, until this Tuesday,

had planned to allocate to pay the organism

starting next 23 with the disbursement of about $ 1.9 billion.

If the government's political wing demands pesos in the attempt to regain ground in the November 14 legislative election, everything indicates that Guzmán will have to get them.

The economist Federico Furiase, from Anker Latin America, warned about an accounting device using the IMF SDR that the government could use to issue more pesos until the end of the year, exceeding the limit established by the Central Charter.

The device would be that instead of paying the IMF directly, the Treasury, in accounting, "could place a

non-transferable bill

to make the reserves that allow it to pay the agency and sell the SDR to the Central Bank against monetary issue."

Thus, by an accounting magic, the IMF's SDR would

multiply the


emission capacity

to comply with the designs of a defeated government that has little time to play revenge.

Like any sketch,

the "swat plan"

need analysis, adjustments and opinion in the ruling coalition, Cristina Kirchner, who historically decided to fight back



After losing the legislative election to Sergio Massa in 2013, Cristina Kirchner's decision was to approach international organizations to appoint a moderate like

Juan Carlos Fábrega

in the Central Bank (Axel Kicillof was Minister of Economy) and to order a devaluation of the peso to change expectations.

What will you do now?

The curtain will begin to draw in the next few hours and the circumstances are very different and not only because of the pandemic.

The dollars that remain in the Central Bank

are scarce

to think about

distributionist adventures, 

and experience indicates that when there are many pesos turning, inflation or the price of free dollars reflect it and in an accelerated way.

Source: clarin

All business articles on 2021-09-14

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