Why did the dollar rise and went closer to $ 40


The exchange rate exceeded $ 39 after approaching the lower limit of the non-intervention zone in October; how they impact on interest rates and political uncertainty Source: Archive – Credit: Getty Images

After falling almost $ 5 and approaching the floor of the floating band determined after the agreement with the


(it arrived at $ 36.39 on November 9), he


began a new wheel of the ups in the last few days that placed it again close to $ 40.

The management of

Central Bank

, the political context that already looks at the elections of 2019 and the movement of international markets are the main factors that, according to analysts consulted by
THE NATION, condition the swings of the exchange market.

A first factor that hit the last wheels was the tender of


last week, which left a surplus of pesos by letters that were not renewed (they sold $ 150,000 million and the BCRA placed only $ 40,000 million) and neither were they withdrawn with Leliq (liquidity letters that can be purchased by banks).

Source: Archive – Credit: Hernán Zenteno / LA NACION

"That stopped putting pesos to the market and opened a possibility of demand for dollars," says Martín Kalos, chief economist of Epyca Consultores, who also highlights the impact of the drop in the interest rate, which after surpassing 73% in October , it now stands at 61.2%. "That implied that some funds that were invested in local currency would bet up by placing the interest rate," he warns.

For Federico Furiase, chief economist of the EcoGo study, the movement of the dollar accompanied the distrust that the international investors showed before Argentina, with the country risk that dropped again over 700 points.

"The disagreement between that rise and the exchange stability is not sustainable in time. The country risk and the expectations of devaluation put a floor to the required rate so that the great players go to the fixed term instead of to dolarize," he argues.

Source: THE NATION – Credit: Fernando Massobrio

Martín Alfie, chief economist of Radar Consultant, coincides with the diagnosis of the rise in the country risk. "It was a negative signal, which reflects the doubts that exist on the financing capacity not so much in 2019 but from 2020, and sooner or later the market was going to be correct. In addition, the international context is not good. There are emerging coins devaluing in the last weeks. They are a set of things that are translated into foreign pressure, "he says.

On the other hand, the political outlook towards 2019, with the advancement of Cristina Kirchner as an opposition referee in the presidential elections, is another factor that generates change in instability, as it happened in the weeks prior to the PASO in 2017. "One of the justifications of movement of the dollar is the rise of Cristina in the surveys, which scares investors, "says María Laura Tramezzani, financial analyst at AAG.

At the same time, the economist warns about the contagion effect generated by the movement of the exchange rate: "Argentina has its dollarized non-consumption portfolio and in such a scenario the demand exceeds the offer. In the world, the coins move in These levels, but this year's devaluation was brutal, it leaves a lot of sensitivity and that implies that any leap returns the questions and there is a phenomenon of immediate coverage that pushes the exchange rate. "

Despite the last exchange movement, the dollar is still located in the lower area of ​​the floating band (between $ 36 and $ 47 for the wholesale contribution). "We are under half of that strip, and the BCRA is comfortable with that situation. When it is on the lower edge, the dollar can only rise, and that fed the speculation in a single way. Now it can have greater float," says Kalos.

"The BCRA could foresee all the elements that led to the exchange rate. The questioning is what happens if this generates expectations of greater devaluation," he adds.

In this context, the reference rate in the Leliq placement that the BCRA carries out was maintained after 15 consecutive consecutive days, in an auction in which the agency withdrew $ 44,869 million (they won 93,325 million and placed a total of $ 140.075 million) . According to Furiase, it was a successful decision that impacts on the dollar (today the retailer dropped 39 cents) and "the expectations of devaluation and inflation".

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