Currently, external factors bring relief to this panorama. In recent weeks, emerging currencies appreciated against the dollar, mainly Latin American ones. Among other reasons, this appreciation was driven by the rise in interest rates in the region to combat the acceleration of inflation and by the increase in the prices of raw materials that encouraged greater foreign currency inflows.
The currency that topped the list was the Brazilian real, which went from trading at 5.13 reais per dollar to 4.71 reais in the last month. The appreciation of the Brazilian currency, Argentina’s main trading partner, is key to improving competitiveness, since it favors the terms of trade and gives the Central Bank more room to avoid a sharp depreciation of the peso. Other currencies in the region followed the same path, such as the Peruvian sol, which appreciated around 3%, and the Colombian peso, with an appreciation of 4%.
These factors allowed the peso to recover some of its lost competitiveness. The latest official data, from May 27, shows that the real multilateral exchange rate (TCRM) is 98.5 points, that is, an improvement after having touched its lowest level in four years at the beginning of May (95 points). . However, it is still below the value agreed with the IMF. The Government made a commitment to the international organization to keep the TCRM stable at the values of December 2021, when it was at 102.5 points.
Andres Reschini, analyst at F2 Financial Solutions, said: “The real can take pressure off the Central Bank on the rate of depreciation, and in fact has been doing so since mid-May. In the same way as the slight decrease in the dollar index, which reached 104.8 points, a maximum in 20 years, and is currently at 101.5 points”.
For his part, the economist Federico Glustein, I consider that This dynamic helps because “less foreign currency would be required for imports from, for example, Brazil, which is our main trading partner.”
However, despite the fact that the appreciation of the currencies of the region allowed the BCRA to be given some margin in the short term, analysts expect that in June the depreciation of the exchange rate will continue to accelerate, on the one hand, due to the delay that in relation to inflation, and on the other, because it is a key month to accumulate reserves and comply with what was agreed with the IMF.
“In the event of the scarce absorption of reserves by the BCRA and the obligations ahead, it should even slightly exceed monthly inflation. If the national reality were different, I have no doubt that the appreciation of emerging currencies would alleviate devaluation expectations”, Glustein pointed out.
Likewise, Reschini added: “We continue in a global scenario with too many tensions and conflicts. June is very challenging for the BCRA. If you want to accumulate reserves in this scenario, you will have to validate a higher depreciation rate, given that the high level of restrictions is no longer efficient for you, the volume of operations in the spot is low and has proven not to be sufficient to supply the demand. authorized, among which is the importation of energy and the accumulation of reserves that it established with the Fund”.