Martín Guzmán, Minister of Economy: “The blue dollar is not a reference exchange rate for prices”

(Telam)

The Minister of Economy, Martin Guzman, affirmed that the measures announced by the Central Bank in exchange matters aim to face the problem in a “comprehensive manner”, that the objective is to “stop losing reserves” and then tackle an accumulation process and “once Argentina has a strengthened front ”, move“ towards another regulation scheme ”.

Regarding the behavior of the informal dollar, which yesterday closed around $ 145, the minister said that the government “does not observe the blue dollar as a reference exchange rate for prices.”

When asked about the exchange rate gap, the head of the Palacio de Hacienda said that “the stability of the gap is an issue that concerns us” and that “these measures seek to establish stability between the official exchange rate and the (dollar) MEP and the CCL ”.

“A gap at the levels it is at is a gap that bothers the operation of the economy. We aim for the gap to be lower. The horizon is for exchange rates to converge and there will be no gap, but we know that this will not be achieved from one moment to the next ”, he concluded.

The tightening of exchange restrictions by the Central Bank was known two days after Guzmán himself pointed out that the exchange-rate stocks are “a symptom of a situation of imbalance that we want to correct” and that “closing the stocks more would be a measure to endure and we did not come to that but to reassure the economy “.

The objective, to begin with, is to stop losing reserves, and then accumulate and once Argentina has a strengthened front, then we will seek to move towards another capital account regulation scheme (Martín Guzmán)

This Wednesday afternoon, in statements to Telam, Guzmán stressed that “exchange rate stability is an asset for the entire economy,” after which he pointed out that “Banning the saving dollar is not the solution, that was going to face a single problem in isolation. This Government wants to face the problem in a comprehensive manner ”.

In statements to Telam, the minister added that one of the decisions It was “making the savings dollar more expensive” at the same time that the Central Bank came out to announce “a scheme that encourages companies to restructure their assets in dollars.”

He added that measures were added to facilitate “the entry of capital by eliminating parking for both the entry of the MEP dollar and the CCL dollar.”

“In the immediate term, these measures have to be understood, so surely there is some anxiety and we seek to dispel doubts. In the first months we hope that the drainage of reserves will stop, then, later on, we look for reserves to begin to accumulate. The objective, to begin with, is to stop losing reserves, and then accumulate and once Argentina has a strengthened front, then we will seek to move towards another capital account regulation scheme “, he stressed.

“” A gap at the levels it is at is a gap that bothers the functioning of the economy. We aim for the gap to be lower, “said Guzmán. (Photo: Telam)

“The Central Bank has to ensure exchange rate stability and was facing problems in the international reserves front, for reasons of demand and for reasons of supply,” he said. In that sense, The minister stressed that “for reasons of demand, he faced the loss of reserves per dollar of savings and due to the fact that companies that have a financial debt in dollars, which grew brutally, had no incentive to refinance those debts in dollars by borrowing dollars” .

While the Central Bank announced the exchange restrictions, almost at the same time Minister Guzmán presented the 2021 Budget project to the press, where it was confirmed that the fiscal deficit in 2021 will reach 1.7 trillion pesos and 60% of the same will be financed with issuance, at the same time that an inflation of 29%, a rise in GDP of 5.5% and an exchange rate of $ 102 for December was projected for next year.

“On the same day, the macroeconomic transition program was presented together,” Guzmán said. And he specified that the bill, which was submitted to Congress yesterday, took into account the exchange regulations issued by the BCRA.

“The Budget, the projections it contains, internalize the measures announced yesterday by the Central Bank,” added Guzmán, who emphasized that the initiatives were worked “in a coordinated manner.”

I kept reading:

The blue dollar rose to $ 145 and reached a new record at the start of the restrictions

Budget 2021: the fiscal deficit will be 1.7 trillion pesos and will mostly be covered with issuance

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