Repercussions of the trip Javier Miley The delegation arrived in the United States on Saturday afternoon. The Bloomberg Linea cable confirmed that in a private conversation with investors, the Minister of Economy said, Louis CaputoHe acknowledged the possibility of accelerating the rate of slippage of the exchange rate band. But the government’s response also came too late..
Sources in the Ministry of Economy confirmed this only on Sunday afternoon, and after some media outlets reported it information That version is false. When asked if there would be no edits or announcements in the next 30 days, they gave the same answer: “Wrong.”
In a reconstruction of the meeting, Bloomberg Linea noted that Caputo told investors that he was evaluating adjusting the cadence with which the teams… 1% Still 1.5% per month.
The version came after Miley said in an interview with the Financial Times that the swap bands would continue until 2027, the end of his term. But this will continue to expand until it loses its importance.
“Sailing the US treasury and winning the election allows the government, along with the associated costs, to maintain an exchange rate system that has long lost its effectiveness,” said the economist from consulting firm Analytica. Claudius Caparolo. In any case, the analyst believes that it is difficult to imagine a scenario that does not include changes in the current exchange rate policy, but he believes that it is logical for the government to deny this, to prevent the market from seeking to move forward.
He said: “In its favor, unlike previous months, the economic team today has the necessary tools to implement a smoother transition towards a scheme that allows it to accumulate international reserves and fulfill its obligations.”
The exchange rate regime was in major doubt in the weeks leading up to the legislative elections on October 26 due to the sales of international reserves that the Central Bank of the Argentine Republic (BCRA) had to make at the top of the range and the interventions of the US Treasury in the middle.
Although the victory at the ballot box, by a large margin with the Forza Patria party, has given short-term wind to the exchange rate system, domestic and international economists, investment funds and banks still have doubts about the current “floating” system.
Last week was Pramol DhawanHead of Emerging Markets Portfolio Management at Pacific Investment Management Company, who advised:Let your coin float“.
Last Friday, the wholesale dollar closed for sale at $1,415, After being cut one day $37 And in a week $52 With a bank holiday in between. What kept him away from the band?$1,499.50) although not to a large extent. There is only distance $84.5.
The version of the adjustment in the rhythm with which the bands move occurs in a context in which inflation begins to accelerate. after 2.1% Which saw the Consumer Price Index (CPI) in September, there are consulting firms estimate that it may be 2.4% In October.
“Beyond the recent decline, the exchange rate remains close to the ceiling, which is barely slipping 1% monthly. As inflation approaches 2%the ceiling is estimated in real terms month after month. If this configuration is maintained, says Miley, until 2027, the risk will end with a quasi-fixed exchange rate regime.“, they noted in the Econviews report that directs Miguel Kegel.
When prices fall and the accumulation of dollars accumulates, the closing will be better with a higher exchange rate. “Something that will certainly also be beneficial for the country’s irrigation,” they noted in the report, as this is the main variable for accessing international markets in January 2026.
It also sows doubts about the goal of reserve accumulation that Caputo agreed upon with the International Monetary Fund. By December of this year, the BCRA should have a network -2.6 billion US dollars And according to the calculations of private consultants, it is US$7,000 / US$8,000 million To reach it. This was practically impossible, and even more so after the introduction of the field liquidation with a zero-blocking procedure that lasted less than three days.
This will be the second time that Caputo will sit before the Executive Director of the international organization next February. Crystalina GeorgievaAnd tell you that you missed the goal of accumulation despite cutting it off (from 2.4 billion US dollars to -2.6 billion US dollars). The only thing it should show you is the already unified fiscal target and slowing inflation, which will pose difficulties in the coming months.
Last Friday, BCRA’s international reserves fell to… $40,260 USD millionThen the last maturity date is paid to the International Monetary Fund ($825 million such as interest). This is a shift in silence on the part of the government.
As he confirmed informationCaputo activated part of the swap with the United States to fulfill this commitment with the International Monetary Fund. And also going back to the North American Treasury Secretary, Scott Besant, Dollars he sold in the weeks before the election.
Reports that Besant was taking the dollars he sold began to grow last week when an Economist said: Alejandro GiacoiaIt showed that the stock of BCRA letters (where the peso was) fell on October 31, at the same time that the “other liabilities” item rose.
As much as he could know information With the sources aware of the process, it will be the activated section of the swap 3 billion US dollarsout of total 20 billion dollars. When referring to official sources from the Ministry of Economy and the Corporation, there was no response as of writing this note.
But it was Picent himself who said in response to questions received by Donald Trump’s government regarding financial aid to Argentina: “The Argentine economic bridge generates profits for the American people.”.
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