Blue dollar at $217: the five reasons why the parallel note cannot find a ceiling

The blue dollar live a summer record. This week found a new roof every day. Thursday closed at $214, the highest face value in history, and this Friday jumps three pesos to $217.

So far in January, the parallel ticket increased by $9 and advanced 4.3%. In 2021, it grew just over 24% against inflation of 50.9%, so there is still room for further progress, economists estimate.

I also read: Hot prices: inflation does not let up and there are increases of more than 2% in food in a week

These are the five reasons for that the blue dollar does not stop rising Y break records every day.

1. Drought in the countryside

drought in the field meant to the sector, as of January 13, losses of almost US$3 billion in export earnings. That is the calculation of the Rosario Stock Exchange (BCR).

for the economist Fernando Marull, from the consultant FMyAThis is the first of five reasons why the blue dollar is on fire these days. It happens that the field is the main sector in terms of foreign exchange income, and drought does not help to strengthen reserves of the Central Bank (BCRA).

2. A complicated Central Bank

So far this week, the Central Bank had to sell $140 million to meet the demand and keep the price of the official dollar “at bay”.

These are stressful days for Central coffers, which are not at their best. Today it is estimated that net reserves without gold they are below US$3 billion, little more than what is owed to them. pay to the International Monetary Fund (IMF) in March.

I also read: More obstacles to the Mep dollar: buyers will have to file tax returns

If those total reserves they reach zero, one of the few remaining solutions is devalue currency, a scenario that the Government wants to avoid.

3. There is no agreement with the IMF

A self-explanatory reason. Still There is not too many news of progress of the agreement with the IMF more than some approach to US officials to get support.

More than a year ago the new bonds came onto the market after the agreement with private creditors. The Government was expected to reach a understanding with the IMF early, but it didn’t happen.

Despite the meetings that were held in 2021, the agreement between Argentina and the IMF is not made official.  (Photo: Twitter @KGeorgieva).
Despite the meetings that were held in 2021, the agreement between Argentina and the IMF is not made official. (Photo: Twitter @KGeorgieva).

Economists say that an agreement with the IMF would give the economy a certain ordering framework, since the multilateral organization usually has “requests” related to the fiscal deficit, the exchange rate and inflation.

“It is no coincidence that the rise in the blue takes place after two weeks of decline in sovereign bonds. Last week the CCL dollar was trading at $211. The lack of agreement with the IMF puts on Doubts the eroded debt sustainability“, sum Matthias DeLuca, consultancy analyst LCG.

I also read: Eight days before the next due date with the IMF, the Government does not know if it will pay

“The government shows reluctant to reach zero deficit in the short term, which affects confidence in the country and, with it, the price of bonds, which drags the dollar (which is nothing more than a reflection of the value of the peso)”, he explains.

4. “Excessive” pesos

“We knew that the very strong issuance of pesos that occurred in the last quarter of the year, which was 2.1 points of GDP, was going to be transferred to the gap“, Explain Juan Ignacio Paolicchi, consulting economist Empiria.

The Central Bank injected a large amount of pesos into the economy during December and the surplus is used to buy dollars.  (Photo: AFP/Juan Mabromata).
The Central Bank injected a large amount of pesos into the economy during December and the surplus is used to buy dollars. (Photo: AFP/Juan Mabromata).

The gap is the difference between the official wholesale dollar and the parallel dollar. At this moment it is about above 100% and it is a worrying level for economic activity. Generate distortions in imports and exports because it gives the feeling that the official dollar should rise to close that difference.

I also read: The details of the new tool designed by the IMF to finance countries like Argentina

“In January and February, the blue dollar had room to rise due to that issue in a context where the demand for pesos is beginning to moderate a bit, you no longer have to pay bonuses or get pesos to go on vacation”, adds Paolicchi.

5. The blue was late

the blue dollar advanced in 2021 less than 25%, half of what was inflation.

According to Marull, this value of $214 was not even the highest if the effect of the inflation, that is, in real terms. If updated to today’s values, the parallel would sell for over $300, points out.

“Inflation accelerates (3.8% in December) and prices of goods are updated, among them the dollar”, adds De Luca. And he concludes: “Compared to December 31, the blue dollar these days implies an increase of 2%. That is, it is adjusting more or less in line with inflation which is running during January”.

Leave a Comment