The 6.7% monthly inflation in March, the highest price rise in 20 years, turned on the warning signs of all analysts and further pushed analysts’ estimates on the quote of the dollar.
According to a Latin Focus Forecast report from April, a study that averages the estimates of 45 consultants and financial entities, this year the wholesale dollar will close at $156, although several estimates place it between $170 and $184. Regarding inflation, the study maintains that this year will close at 57%, almost three points more than the previous study (54.2%), with the highest estimates between 65% and 73.5%.
A week earlier, the Market Expectations Survey (REM) carried out by the Central Bank among several analysts estimated that the official exchange rate will reach $154 in December and $222 by the end of 2023. This month the report estimates that the dollar will continue to grow below inflation: “The forecast of those who respond to the REM indicates a monthly rise of 3.8% to $113.60 in April.”
For its part, this week the blue dollar fell to $195, its lowest level in six months: from its record of $223.5 reached on January 27, it has already dropped $28.5. Some factors that explain this decline, according to analysts, is that the disbursements committed by the IMF are added to the seasonal liquidations of agriculture, which have been breaking records due to the increase in international grain prices due to the war in Ukraine.
Estimates from 45 consultants and financial entities indicate that the wholesale dollar will close at $156.
To try to stop a run towards the dollar following knowing the inflation data, the Central Bank decided this week to raise the annual nominal interest rate of the Liquidity Letters (Leliq) to 28 days, from 44.5% by 250 basis points. to 47%, which represents an Annual Effective Rate (TEA) of 58.7%.
This will in turn carry over to the rates of fixed terms, which according to the BCRA for deposits of up to $10 million made by human persons will be 46% annually at 30 days, which represents a yield of 57.1% of TEA. For the rest of the fixed terms of the private sector, the guaranteed minimum rate will be 44%, with a TEA of 54.1%.
“Active interest rates remain at levels compatible with the promotion of investment and production, and the development of the Mipyme sector. Additionally, the BCRA will continue to regulate the conditions of access to credit for family consumption,” said the entity.
Despite the measure taken, the entity clarified that “the rate hike is a necessary condition but, by itself, not sufficient to reduce inflation.” According to him, it will also be necessary “the consolidation of exchange rate stability through a process of accumulation of international reserves” and “a downward exchange rate gap in the so-called financial dollars, reflecting the perception that the fundamental determinants of the macroeconomy have improved. “.
He also assured that “the reduction of the fiscal deficit will be necessary, which will require less monetary financing”, and “a downward trajectory of the stock of remunerated liabilities of the BCRA (Leliq and Passes) in terms of GDP, as a consequence of the lower primary issue , the gradual convergence towards fiscal balance and a greater demand for money due to the consolidation of a sustained growth process”.
