In dialogue with Channel E, Sebastian Menescaldian economist, assessed the statements of the Vice President of the Central Bank and claimed that without a clear reserve creation policy, country risk reduction will continue to be insufficient.
The debate over sovereign risk returned to focus after the central bank’s vice president told investors that the indicator had normalized without changes in reserve policy.
For Menescaldithis reading is incomplete. “There is a debate between what the government is defending and what the market sees“, he explained, pointing out that although the executive branch prioritizes reducing the country’s risk and then accumulating reserves, investors are demanding the opposite approach.
According to the economist, the election victory eliminated political risk, but was not enough to restore full access to external credit. “Country risk fell after the election victory, but was not sufficient to return to international markets at a reasonable cost“He explained. Today, he clarified, Argentina only has access to the local market, a limitation that affects financial sustainability.
Reserves: the signal the market is waiting for
Menescaldi He argued that the market needs concrete definitions, not general announcements. “The market continues to urge the government to accelerate the reserve accumulation policy“, he stressed. In this sense, he considered it crucial to set a clear target for 2025, even if its fulfillment will be gradual.”Even if the reserve accumulation target is announced, the market will respond positively” he added.
He also recalled that the government had opportunities to purchase dollars both after the agreement with the IMF and during the reduction in agricultural retentions, but chose not to do so in order to avoid issuing pesos. “Today the government itself tells you that this surplus of pesos no longer exists“, he explained, explaining that the current remonetization of the economy opens a window for the purchase of reserves without creating imbalances.
Maturities, repo and emergency risk
With $4.3 billion due in January and only $1.4 billion available, Menescaldi He warned that a massive entry into the foreign exchange market would put pressure on the exchange rate. “The other side is to raise the dollars through a repo so as not to impact reserves” he noted, although he acknowledged that there were still operational doubts.
He commented categorically on the exchange: “Today it should remain a last resort.“since early deployment would send a distress signal. To return to markets, he estimated country risk should be between 500 and 550 points, albeit with moderate emissions.”If you pay the 9 or 10% tax rate, a tax problem arises“, he warned.
Finally, as far as inflation is concerned, he claimed that the 2.5% in November was due to certain factors. “In the future it should decrease, albeit slowly“, he predicted, with the possibility of consolidating records close to 1% only towards mid-2026.
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