The rise in the interest rate to encourage savings in pesos does not seem to make a dent in the dollar. The fixed-term rate is now 2.75% against inflation of more than 3% expected for August due to the release of commercial activities. The Central Bank resorted to this strategy to encourage Argentines to immobilize pesos, but it has a difficult rival in the dollar, which increased more than 80% in the year.
In the last hour and a half of operations, alternative dollars escaped, with increases of up to 2.7%. The dollar Stock Market or MEP advanced $ 2.82 to $ 119.54, while the cash with liquidation rose no less than $ 3.15 to $ 121.41. The “blue” or free, followed the trend and closed $ 1 up to $ 136 and fears with resuming its bullish pace after the month-end obligations.
For Federico Furiaseeconomist of EcoGo and professor of the Torcuato Di Tella University, “The rate is raised due to pressure on the gap and the higher inflation they expect, but they are going to maintain this rate of devaluation, which is also negative in the face of expected inflation, to try to anchor prices. And they can do it because they made a currency buffer all these months that devalued above inflation. In any case, for the exchange rate not to wear them, they will need a successful debt negotiation.“
Meanwhile, banks and exchange houses adjusted the dollar by 19 cents to $ 76.27, which raised the solidarity dollar to $ 98.80. The wholesale dollar increased the usual 6 cents and closed at $ 72.26. The wholesale wheel had a surprise. The liquidation of exporters was almost non-existent and the amount that was negotiated is among the lowest of the year, USD 146 million. Of course, in order to satisfy importers’ demand, the Central Bank was purely a seller. He got rid of more than $ 60 million.
That is why the reserves dropped USD 50 million to USD 43,338 million. The drop would have been greater if the main currencies against the dollar had not risen. The DXY index showed how the dollar lost 0.53% against the euro, the pound sterling, the Canadian dollar, the yen, the Swiss franc and the Swedish krona. Gold, which in the post-closing period was breaking a new record when trading at USD 1974 per ounce, also contributed to keeping the amount of reserves at this level.
The resurrection of gold finds its basis in the constant fall of the dollar against the main world currencies and the non-existent interest rate that yields the United States Treasury bonds. The 10-year-old lowered its yield to 0.52%. By the end of the year, Wall Street analysts risked that gold could hit $ 2,200 to 2,300 per ounce.
The bonds in dollars with local legislation, were balanced while waiting for news of the debt. The Bonar 2020 was unchanged and the Bonar 2024, lost 0.79%. The long bonds of foreign legislation, which are the protagonists of the debt negotiation, had mixed behavior. The Discount lost 2.51% and the Pair was unchanged. In these circumstances, the country risk did not move from 2,273 basis points, although at one point in the day it pierced the 2,300 point ceiling.
The Stock Market reversed a wheel that started negative. The S&P Merval, the leading stock index, went from being 3.56% down at 11.30 to rising at the close 1.07% with a business amount of $ 2,345 million, which is 10% higher than the previous day . The actions that contributed to this rally were those of Transportadora Gas del Sur (+ 5.80%), BBVA (+ 3.19%), Aluar (+ 2.86%) and YPF (+ 2.26%).
Argentine ADRs – certificates of ownership of shares listed on Wall Street – had an adverse wheel. There were only two increases, that of MercadoLibre (+ 1.9%) and that of Transportadora Gas del Sur (+ 1.6%). MercadoLibre, so far this year, is about to double its value. It already has accumulated gains of 93.6%. In 2019 it increased in dollars 102%. The most important falls were those of IRSA (-7.4%) Cresud (-5.8%) and Loma Negra (-5.4%).
For the economist Miguel Boggiano, “The gap between the free dollar and the alternatives began to narrow, while the stock market is waiting for some kind of definition in debt negotiation that, perhaps, we will have soon. I am still optimistic because they already had time to kick the board. I am of the idea that the Government is clear that it cannot go until the last day with the exchange stock and knows that the first step to lift it is to fix the issue of the bonds“
In this hope, it is the one that is operating the market. There is a mix of caution and opportunity buyers. The one that seems immune to everything is the dollar that continues to rise. There the cautious take refuge.
I kept reading:
To contain the dollar, the Central Bank raised the minimum rate for fixed terms in pesos again.