At the end of the week, the blue dollar surpassed a new psychological barrier: $290. The arrival of the new tax charges for the card dollar and fears of an increase in restrictions on financial exchange rates – due to the departure of Adrián Cosentino from the CNV – added pressure on the exchange market. Since yesterday, the free dollars began to rise and the “calm” that Silvina Batakis, the new Minister of Economy, tried to bring on Monday with the announcement of fiscal rationality measures evaporated.
Today the blue dollar continued its upward path and closed the day in the $293, $4 higher than the previous round (+1.3%). Again, reached the highest nominal value on record, although during some hours of the day it reached a peak of $295.
If the course of the week is analyzed, the parallel exchange rate accumulated a rise of $21 (+7.7%). If you look at all of July, so far it has advanced $54 (+22.6%). This is explained by many factors, including the departure of Martín Guzmán from the Palacio de Hacienda, the issue that the Central Bank (BCRA) has been carrying out, the tightening of the exchange rate and record inflation.
“Clearly, the measure regarding the card dollar did not play in favor. Now, this was also combined with the resignation of the President of the National Securities Commission. I think that today the main fear of the market is that they touch the parking. The future of what happens with the leadership of the CNV these days and whether or not new measures will come like the ones we had around July 2021, when they modified the parking, it will be crucial for the future of the gap”, warned Juan Pablo Albornoz, economist at Ecolatina.
All these pressures were also reflected in financial exchange rates, which also set historical records. Today the MEP dollar o “Bolsa”, which makes it possible to circumvent the exchange trap and become legally dollarized without restrictions, appeared on screens $291,31, $6.6 more than yesterday (+2.3%). In a volatile week, it closed $5 higher and almost $44 for the month (+17.4%).
The dollar counted with liquidation (CCL), a financial market tool used to settle dollars in a bank account outside of Argentina, was offered to $301.49, a daily advance of $6.5 (+2.2%). The weekly run was only $0.6 (last Friday it also ended above $300) and for the whole of July it was $49.3 (+19.3%).
“The market needs facts to react positively. The distrust towards this government management is very strong. It was shown that, no matter how much those responsible change, the market needs to validate with facts the statements or measures that are announced”, said financial analyst Salvador di Stefano.
At the windows of Banco Nación, the official retail exchange rate appeared stable at $135. If to that is added a 30% PAIS tax and another 35% Profits, it results in a dollar “savings” of $222.75. On the other hand, with 30% of PAIS and 45% on account of Profits, it gives the new dollar “card” at $236.25.
The official wholesale dollar, whose price rises drop by drop due to the controls of the Central Bank (BCRA), was sold to $128,25 (+0.2%). Thus, the gap with the blue dollar was 128%; when contrasted with the dollar counted with liquidation (CCL), today the highest value in the market, it was almost 135%.
“No government wants to devalue. Batakis is showing that he is not looking to do it. Moreover, it recently placed Dollar Linked maturing in July 2023, which is added to the existing bonds that mature, within the Fernández Administration, in October of this year and April of the next. Faced with this, at most it can have in mind to frame the real exchange rate within what was signed with the IMF, which would imply an adjustment of no more than 12%, to then continue with the current homeopathic doses”, pointed out Walter Morales, president of Wise Capital.
For Albornoz, in the last week the Central Bank was trying to “do good handwriting” by not prorating Leliqs, while continuing to intervene in the bond market. But yesterday he did not raise interest rates, as it did in the last six months when the Indec released the inflation data. Instead, he ordered the implementation of a interest rate broker for short-term Treasury Bills, the 28-day Leliqs rate and the overnight Repo rate.
“It is important how the new rate channel will be implemented: sooner or later the Treasury and the Central will have to offer higher IRRs [retornos] in pesos if they want to encourage demand for savings instruments in local currency. Treasury bills yield around 70% and Leliq just under 67% effective annual rate (TEA). With an inflation that even being optimistic would not fall below 80%, they are going to have to raise them. Hopefully it will be sooner rather than later”, completed the Ecolatina economist.
Today the country risk stood at 2754 basis points, two units less than yesterday (-0.1%). However, so far this month the index prepared by JP Morgan accumulates an advance of 380 points (+16%). In this case, not only the local noises have their effect, but also the fears of recession that investors have at a global level.
The explanation of why the Argentine risk grew so much lies in the bonds of the last debt swap, which have been touching minimums. Today, sovereign bonds traded mixed: abroad they fell up to 2% (AL41D) and at a local level they rose 2.7% (AL35).
“There is stress regarding the fulfillment of goals with the IMF, uncertainty regarding the economic plan and the coordination of the current ruling team, and an electoral contest for the next twelve months (as things currently stand, there are very few possibilities to glimpse clearly what can be the result), They make up a cocktail of uncertainty that is usually a very significant value destroyer with respect to financial markets. If there is something worse for reading the markets than bad news, it is uncertainty or no news”, added Brian Torchia, manager of Corporate Finance at Pgk Consultores, a member of TGS Global.
With the focus on the stock market, today the S&P Merval rebounded 3.7% and stood at 104,222 units. The Buenos Aires stock market panel was led by BBVA (+6.4%), Bolsas y Mercados Argentinos (+6.3%) and Sociedad Comercial del Plata (+5.6%).
The same trend was replicated in the Argentine stocks listed in New York. Mercado Libre papers advanced 6.6%, followed by those of Banco Francés (+2.8%), Pampa Energía (+2.5%) and Banco Macro (+2.4%).
