Government financial obligations, coupled with political uncertainty, raise the strain on the dollar. Analysts warn about the consequence
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<p dir="ltr">With the return of the exchange rate, in its light version for individuals but more restrictive for companies, the contributions of "counted with liqui" or the "MEP dollar" gained an unusual prominence in the City of Buenos Aires.
These operations with which you can buy dollars in the capital market – either to leave them in the country or to take them to an account abroad – ceased to be an almost exclusive move of financial investors and became the only ways to that companies can access the US currency.
Thus, over the end of last week, the need for some companies to turn currencies caused a jump in the price of the "cash bill", which brought it close to $ 74, while the official price gap came to overcome the 30th%.
This last number (the gap) is the new indicator closely followed by economists and industrialists, since they warn that it can directly impact the price index.
Although in the last wheels the "counted with liqui" remained stable at around $ 69 – with a gap of around 19% -, in the market they warn that In the next few days the pressure to turn dollars abroad will increase, so that the gap regarding the officer will widen again.
The initial kick would take place between Friday and Monday, when the Government pays about $ 24.8 billion between interest and capital of the Monetary Policy Bond (Bopomo), of which half is held by the PIMCO fund and the same is held by Other foreign investors.
Then it will be the turn of companies and other investors. The former will do the same to be able to make dollars, either to advance payments abroad or simply to cover a possible devaluation. Investors, meanwhile, will seek to be oblivious to electoral risk in the face of the October 27 elections.
PIMCO's pressure
"I imagine that a large part of those who charge Bopomo will do 'counted on liquidation', unless they want to be invested in pesos in another instrument in Argentina, something I doubt," says Gustavo Neffa, partner and director of Research for traders.
In that sense, he adds, "The pressure on the end of the week should increase again."
In the same vein, Gustavo Ber, head of Estudio Ber, commented in his report on Wednesday that the gap resumed the decline although he warned that "the expectation among operators for such dynamics grows before the next disbursements of titles in pesos that foreign investors will receive ".
It happens that with the stocks established by the Central Bank, the "counted on liqui" is the only option that foreign investors have to spend dollars in the pesos deposited in the Caja de Valores and take them to their account.
Last Monday, the monetary agency relaxed the exchange of currency by the Caja de Valores to foreign clearing houses for those investors who had sovereign bonds that are guarded abroad.
"The Bopomo pays pesos. The Caja de Valores deposits those pesos in the country, so it can press the 'cash bill'. They have no other way of turning it than there, since they cannot enter the exchange market ", highlights Santiago López Alfaro, partner and director of Delphos Investment.
Anyway, López Alfaro does not believe that all foreigners who charge the bond will take the money out of the country. "I understand that some foreign investors would not be willing to pay $ 70 per dollar to get them out of the country and perhaps reinvest it in some other peso bond," explains former FGS number one. "Lost for lost, many begin to look for alternatives," he says.
But the payment of Bopomo is only the beginning of a pressure on the "counted on liqui", which threatens to widen the gap.
"I clearly see different risk factors that could continue to generate a wider gap," says Federico Furiase, director of the Eco Go Study.
The threats that the market sees
The first risk that Furiase lists is the political factor. "We are in a context of uncertainty, where imbalances are poorly aligned and that could continue to generate financial instability, with a Central Bank losing reserves," he says.
Another risk that threatens to widen the gap, according to Furiase, has to do with financing the fiscal deficit, in a context of country risk above 2,000 basis points and with the disbursement of the International Monetary Fund even without confirmation.
"Between November and December the bulk of the fiscal gap is concentrated and, without access to the international market or the domestic market, that could force some monetization of the BCRA to generate pressure back in the gap," explains the economist at Estudio Eco Go
Finally, the economist refers to the maturity bonds in pesos that remain in the remainder of the year which, like what could happen with the payment of Bopomo, is a factor that threatens to increase the pressure on the "counted liqui ".
"Clearly financial instability, With a growing gap and a BCRA losing reserves in a context of political uncertainty, this gap can generate pressure on the exchange rate and inflation expectations at some point."sums up Furiase.
That the increase in "counted with liqui" impact on the prices of goods is something that also warns Cesur economist, Amilcar Collante. "If the companies, which are the ones that define the prices of the products based on their costs, have to turn foreign currencies abroad and have a surcharge, obviously then they will charge it at local prices. If they have problems to import, that extra cost moves to prices, "warns the economist.
"I do not know if the price of 'counted with liqui' is going to be a reference. It depends on how many operations are carried out there. Undoubtedly if it takes volume it can have a greater incidence on prices," adds Collante.
For Martín Kalos, chief economist at Elypsis, "There are currently four different prices for the same merchandise, which is the dollar, and the effect it has on the economy depends on the price that each one gets and believes that he will get the dollar in the future".
That means – the economist adds – that if for imports or payments of debt and operations more habitual for the production it is possible to be obtained to official dollar, that should be the cost that it has in the cost structure.
Now, if it happens as it happened at the end of Kircherism, that by the policy itself that anticipated that if we won Change we would expect a reunification at the level of the highest alternative exchange rate as it happened at the time, "an expectation of devaluation of the official exchange rate is generated", Explain.
"That is what would be ideal to avoid, but it depends on many factors and we are just beginning with an alternative exchange rate, which still has to be seen which of the dollars is incorporated into what cost structure," Kalos warns, adding: " It's something you have to look closely at but we still can't know for sure how it will be. "
A tolerable gap level
In the market they know that an increase in "cash" ends up putting pressure on the official exchange rate and there are many who believe that a 50% gap is the maximum tolerable level to maintain the current exchange rate.. That is why the Government and the Central Bank are looking for the "counted with liqui" to continue rising.
According to Norberto Sosa, director of Investing in the Stock Exchange, between 2012 and 2015 the "counted on liqui" has tended to converge "towards the convertibility exchange rate". Therefore, he adds, "it is important that the relationship between monetary liabilities and reserves of the BCRA does not deteriorate, so that the gap does not increase and generates some kind of inflationary pressure."
In that sense, if the market begins to discount that the disbursement of the IMF will not be realized in the short term, or that the reserves will continue to fall due to the intervention of the Central in changes, or by the bleeding of deposits in dollars, the exchange rate of convertibility that you take as a reference will be greater and so the "counted with liqui" will increase.
Another variant to estimate the price that the market would be willing to pay for the currency in operations with bonds is taking into account the Multilateral Real Exchange Rate (TCRM), which considers the basket of currencies of all the countries with which Argentina is related commercial.
In that sense, the latest report by Delphos Investment explains that the current TCRM level of "cash counted" is extremely high, which would speak of a gap reaching the ceiling. "But that's the picture. The problem is the movie," they said in the report.
Assuming months of 5% monthly inflation until the end of the year, they explain, "we could see a drop in the TCRM to pre-STEP levels in case the official exchange rate remains unchanged "and they estimate that" it could take the gap up to 40% towards the end of Macri's mandate".
The new stocks do not yet have a month of life and the different dollar quotes are gaining prominence every day. It is key that the BCRA releases the currency exchange for companies that have to pay obligations abroad and avoid a new pressure on the "counted with liqui", as well as try to ensure that the stocks do not end up affecting foreign trade operations .
Both cases involve higher costs for companies when it comes to making dollars, a differential that always ends up being paid by consumers. That way, the stocks will directly affect the pockets, no matter how much they can buy up to $ 10,000 per month.
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