The assets associated with Argentina were launched on Monday (14). In the country, the S& P MERVAL, a reference to the Argentine grant, ended the session with a jump of 4.7 % to 2,354,419 points. In Wall Street, AdRS was also a day of euphoria, With Argentina receipts, BBVA rises more than 14 %.
However, on the contrary, The dollar rose more than 10 % in the trading session. The climate is still in the Argentine market.
This is because the government of the country has announced flexibility in the exchange market, which also explains the resulting euphoria.
What has changed in the Argentine exchange rate?
Low weight in Argentina has led the dollar to be desirable and restricted in the country. A series of parallel quotations for the official to facilitate business appeared in certain sectors of the economy.
In order to reduce the distance, and thus the volatility between official and parallel exchange – known as the dollar blue – From the country, it was one of the first measures of Argentine President Javier Millie and Minister of Economy, Luis Kapoto, Reduces strong weight.
Since then, Miley used to Shares The currency, restrictions on the well -known exchange market for the Argentine citizen.
On the one hand, Joast Al -WaddThe exchange rate of the central bank in the country fluctuated with deliberate exchange interventions to decrease in the national currency or gradually estimate it. In Argentina, the central bank was acting with a monthly decrease of 1 % of the weight.
On the other hand, restricting access to the exchange market. In the country, the purchase of dollars was limited to $ 200 per month for individuals, as well as other restrictions on transferring profits, distributions and foreign trade.
Friday (11), Caputo announced the end of control measures to the exchange market The implementation of the floating exchange rate is limited to a dollar quotation scale.
With the end of the restrictions, individuals will be able to freely reach the Argentine exchange market, below the maximum of $ 200 and other administrative restrictions. However, a 30 % tax has been announced on the purchase of cards and tourism payments that are still valid.
All restrictions on access to foreign currency have also been removed to profits and profits in the financial statements.
For inherited distributions and inside debt payments (before January 1, 2025), a address called the dollar issued by the Central Bank of Argentina in weights may be participated.
The Argentine government will also finish the dollar MixOne of the distinct quotation mechanisms that aims to sell exporters at more competitive prices.
For foreign trade, the end of 30 days was also announced to pay the imports of goods and final services and relax the restrictions imposed on importing capital goods.
In addition, the floating exchange rate system will be implemented – do not enter – while the exchange rate is around $ 1,000 to $ 1400 will be implemented in the country. “Where will the central bank act? Specifically in the corridors,” said Kabuto.
Why do the changes in Argentine exchange raises the market?
By announcing the end of currency control, the Argentine government said it started the third stage of the economic recovery plan. Since he came to power, President Javier Mili put into effect the financial austerity policy to control public accounts and the country’s inflation.
Although the “very radical amendment” has deteriorated, for example, the salaries of public employees and retirement conditions in the country, Eduardo Fiola, a professor of international relations at the GETULIO VARGAS (FGV) and the University of Sao Paulo (USP), launched fire on Ww The president’s approval is strong.
“There is an important thing that happened in these 16 months: a deep reform program for the Argentine economy, which came from deep decades,” said Viola.
Now the focus will be on restructuring the monetary policy and the central bank of the country. According to Roberto Luis Despee, a partner in TroSter & Associados and former head of the Brazilian Federation of Banks (Febraban), there are estimates that restricting exchange has cost billions of dollars to Argentina BC.
He said in an interview with “with these additional resources, the tendency to increase the muscles of the central bank. (…) Cnn money.
Trrist stressed that the end of currency control and progress in agreement with the International Monetary Fund (IMF) helps to bring credibility to the country and trust in public accounts, and thus, in the tax surplus.
Parallel to the announcement of the end of exchange control, Argentina stated that it had reached a $ 20 billion loan agreement with the fund To enhance the economic policies planned by the government of Javier Miley.
Given the possibility that the demand for dollars means high borders, and thus re -heating inflation, it violates that “time does not pass against Mali.” This is because the support of the International Monetary Fund in parallel “gives consistency to the economic plan” to the Argentine President.
“It will increase inflation, but it can likely be for a month or two. I think this will not wear a significant corrosion of Milli,” he said.
Fiola also confirmed Ww The support that the Argentine earns from the President of the United States, Donald Trump, It was validated on Monday with the visit of US Treasury Secretary Scott Payet.
Daniel Dilabio, director of Exploitas, considers this important step in the right direction to reach a floating currency. The most prominent, in an interview with Cnn moneyEspecially the issue of demand for the dollar in Argentina.
By monitoring this issue as well, Trrist said this procedure can achieve a very good result of the country. “The currency needed to pay payments is weight, but the backup is the dollar,” he said.
And why did the dollar jump in Argentina on Monday?
According to the economists who heard before Cnn moneyand It was the Argentine request in dollars that prompted the currency to jump after the end of the restrictions.
“When you release you, you have a surplus of demand that raises prices in very short time,” explained by Gustavo Song, chief economist at Suno Research, pointing to both individuals and companies that need profit transfers abroad.
Roberto Luis Trosster said he believed that after the first trigger, the dollar should decrease in the coming days.
At this stage, Song emphasized the decisive role of international reserves as a “arrangement” of liquidity to avoid excessive foreign exchange fluctuations.
