Friday, December 3

Blue dollar: Government will try not to exceed $ 200 in the key political week of the year

One of the hopes is that the price will settle, due to the action not of the forces that operate on demand (the over-performance of pesos in the market is impossible to change in a week), but on supply. They trust the ruling party that the arrival of foreign tourists, a factor that has been enabled for a week now, should already begin to expose a certain amount of foreign currency in the alternative market; increasing the supply of foreign currency in search of a better exchange rate outside the official one. According to this view, during the first seven days of the release for access by foreign people with foreign exchange to exchange, and not precisely the official, should have shown a period of rearrangements; that from this week they would have their counterpart in the official dollar.

Official sources also trust that the opening of accounts for tourists to which a MEP exchange rate is guaranteed (about 181 pesos according to the closing of Friday), would also begin to result in expected results. Another factor that is expected to work on the blue is that always the second week of each month, it is time to sell foreign currency to face internal expenses in SMEs, whose managers have the blue as currency of exchange and savings. Once the salaries of the month are paid, and before the beginning of the schedule of tax settlements and payments to suppliers, and without the alternative of financing in pesos on the horizon, the alternative should be to settle dollars (even if it is some), to face these expenses. With the same logic it is reflected that for the second fortnight of the month the same referents who sold currencies would begin to take them; returning the pressure on the price of blue. But, realpolitik through, it would be post-election times.

The third factor to expect a moderation in the demand for alternative dollars is their price. According to the official view, shared by most private economists (even those of the orthodox branch), a price of blue at 200 pesos is simply “very expensive.” It is insisted that it would be a Central American country level, and it is shown that the historical comparison indicates that at post-convertibility values ​​of the first quarter of 2002), the value should oscillate in a range of between 175 and 180 dollars. In the same sense, it is shown that any comparison with countries in the region itself (especially Chile and Brazil), shows Argentina as an absolutely cheap market in dollars and very expensive for the possibilities of locals as foreign tourists. An example is the price of a liter of gasoline at more than 220 pesos in Uruguay, and the purchase value of any electronic product in the region.

Finally, and if all the previous speculations fail, they are the official intention of seriously resorting to some of the “friendly hands” that operate in that market, to demonstrate their militancy in the most important political week of the year for the government. And, as is known, there will always be a financier (generally from the Buenos Aires suburbs), willing to collaborate.

Parallel to the blue and its circumstances, there are the official, legal and intervened dollars. Especially the MEP and the CCL, where for several weeks the official action has been direct, clear and with average results. The last measure of the BCRA that aims to prevent banks and financial institutions from being able to take foreign currency until the end of the month, is added to the large battery of restrictions on access to foreign currency that the entity managed by Miguel Pesce, in his explicit collaboration to the Government so that it arrives with the least possible exchange rate damage to the elections next Sunday. From the Central the market actions are measured, and it is believed that it is too much bullish speculation for reality, and that after the day of next Sunday, tranquility should return. The ace of spade of the BCRA is time. The people of Pesce know that there are only weeks before the rate of emergence of dollars from exporters changes; and that by December the foreign exchange from the heavy harvest (wheat) would begin to arrive. This would mean that the daily balances could begin to balance in less than a month, and that the BCRA has a position of attack, and that it can abandon the mandatory billardism of the last days. In the absence of scoring forwards (field dollars), the best was a defensive attitude to save the attack gale of lawsuits. But they insist in the BCRA that the entity has the upper hand, because the reinforcements will be coming in December.

In this somewhat optimistic panorama, a clarification must be included. All analyzes discount that before March there will be an agreement with the IMF, led by Kristalina Georgieva, which will begin to show concrete progress from the day after the elections. Without the Extended Facilities, it would be like a chess game ending and one starting. The pieces return to their place of origin, and a new and different match begins.

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