O high taxes of interest of the BCRA, a ceiling "to trigger the intervention and the USD 9.6 billion that the Treasury will liquidate until the end of the year they will converge cushion the pressure bullish by the dollar, boosted by inflation, strong demand in electoral times and an eventual devaluation of the Brazilian real.
"Fully flat strips of coin, without slope, could be Real appreciation of weight before a best anchor of expectations devaluation ", considered Nery PersichiniInvestment Manager of GMA Capital.
The joint work of the Treasury and the Central Bank for this purpose can be summarized in 7 points:
1 – More coordination. O Sales of Treasury Bonds and Letters of Letters Liquidity (Leliq) are given practically simultaneously in two rounds: before noon and before the closing of the foreign exchange market at 15 o'clock. Complementing the absorption of pesos by the BCRA and the supply of Treasury dollars, "catch" the exchange rate in the face of possible shocks.
2 – Extinction band change. The BCRA left fixed the "ceiling" of the "nonintervention" zone at 51.45 pesos. Facing inflation that does not 4% monthly the dollar should reach this gap before October, which will allow the entity sell up to USD 150 million of their reserves per day, as agreed with the IMF, to mitigate a pre-electoral escalation.
For Gabriel Caamaño, Chief Economist of Ledesma Consulting, "the BCRA toughen rule before every new inflation data that exceeds expectations, is already bad enough. This opportunity, pointed to the expectations of depreciation (in the exchange rate) in an attempt to generate a correction or higher anchoring of inflation expectations, especially on the marketable goods and services side. "
3 – Reinforcement of coins. Although the Treasury contribution does not 10% of total operated in the wholesale market, the extra supply of US $ 9.6 billion by the end of the year positions the official entity as largest provider of dollars until the elections. For this it is added that the agro will bring more currency this year than in the past, when the drought struck.
"As it was in force, the BCRA ratified that if the dollar operates above the non-intervention zone, it will sell – via auctions – until USD 150 million per day, which are added to the USD 60 million sold by the Treasury until November, "said a report from STRAIN (Center of Political Economy Argentina). "Both amounts are still low in relation to the volume operated on a day of racing, although the freezing of the roof of the area would advance the interventions at a price of $ 51.50, "he warned.
4 – Limited flotation. In fact, the daily sale of USD 60 million treasury is a official attack within the area of "nonintervention", the range in which the Central Bank has committed not to participate with purchases or sales. That reduces the postulate "floating free" for admission.
5 – Predictable supply. Since the currencies that the IMF authorized to sell to the Treasury are not cumulative, the daily sale of $ 60 million is also indicate to the market that there will be coins available, complementary with the announcement of the BCRA have a floor of 62.5% for the of LELIQ, at least until April.
"All the measures of the BCRA harden even more its monetary position. The official goal is to reduce inflation, although the tacit objective is to put a cap on the exchange rate, the main mechanism of transmission at prices in the Argentine economy due to its profound and profound bi-monetary nature, "observed Persichini.
6 – Neither emission nor absorption. As well as BCRA guarantees the "no-problem", in accordance with the "zero" growth monetary base – stabilized at US $ 1.34 trillion -, the Treasury dispenses "sterilization": When you sell currencies, you use the pesos for current expenses, so you go back to the financial market.
7 – Dynamics with costs. The BCRA "froze" the Monetary Base, but its debt at LELIQ is growing, due to the monetary policy interest rates, now in 67.12% per year. Stock has advanced to a new nominal US $ 1,079,988 million (US $ 1,08 billion), while measured in dollars reached USD 25,775.4 million.
The Treasury, on the other hand, is Shedding dollars in exchange for pesos which will be used for current expenses. Then he will have Foreign currency stock again to pay maturities of debt, concentrated in the US currency.