The Central Bank made the largest purchase of reserves in 50 days

The Central Bank (BCRA) opened the week with the largest repurchase of reserves in the last 50 days: it raised some US$140 million (40% of the total, slightly higher than the US$350 million traded today in cash on the official market).

It is an income that allows you to re-exhibit a positive balance of interventions of about US$35 million so far this year, although the “red” for interventions on the market still reaches US$560 million so far this month.

Thus, not onlyChained the eighth consecutive round with balances in favor for his intervention (a period in which he recovered a little more than US$280 million in this way for his meager net reserves), but also raised to 33% the percentage of recovery of what he had sacrificed in the first rounds of the month.

He achieved everything, paradoxically, after a day in which the rate of adjustment of the wholesale exchange rate slowed down again, which he allowed to rise only to $136.64 per unit for sale (he had opened the day offered at $136.85), that is, just $0.47 cents above last Friday’s close, perhaps to reinforce his message to the market : “A jump in the exchange rate is not going to be allowed.”

Today’s rise in the wholesale exchange rate is the lowest for a start to the week since June 27”, noted the exchange operator and analyst Gustavo Quintana, from PR Cambios, something that -taking into account the 0.8% rise that currency is recorded at a global level, according to the Dollar-Index when it climbed to $109, 2 on the day- will hit even more the already very affected competitiveness of the peso.

“A good part of the offer was absorbed by the monetary entity, which ended the day buying 40% of what was traded (about US$140 million), continuing its buying streak and being the largest purchase since the end of June, taking advantage of the fact that the traded volume grew 48% compared to Friday”, Sebastián Centurión, from ABC Cambios, pointed out.

From the BCRA they admit that the official purchase could have taken place because it was a day in which there was a very low demand to pay for energy imports and in which there was an improvement in the private supply of foreign exchange. “There was a lot of demand from SMEs and a lot of liquidation, but also little demand for energy,” they told THE NATION from the entity.

The situation of reserves is closely followed in the market for obvious reasons: the BCRA was scratching the bottom of the pot 10 days ago, when its holding of net reserves would have pierced the US$1 billion floor last Wednesday the 10th, setting off all the alarms.

Are we going up the hill?

not casually Since then, the BCRA has been concerned with closing each wheel with a positive balance of interventions, no matter how small.like the US$1 million that was raised on Friday the 12th of this month. This means that it tries to match the private demand for foreign currency with the level that the supply shows in each wheel.

“The market’s attention continues to focus on the ability to achieve concrete progress with short-term results from the fiscal front and from the accumulation of reserves through measures that are not isolated, but are part of a comprehensive stabilization plan, since that is where the main concerns are concentrated”, agrees the financial analyst Gustavo Ber.

It all happened on a day in which the president of the BCRA, Miguel Pesce, published an opinion column (titled: “The Leliqs now support the savings of Argentine companies and families”) in which he defended the notable and persistent increase that had the debt that this entity contracted in remunerated liabilities (Leliq and passive passes), that is, the instruments with which it removes from circulation the surplus of pesos that it issued without there being the counterpart of a demand.

Precisely this growth is what had been highly criticized in the campaign by today’s president Alberto Fernández, calling it “usury” and promising that he would redirect that spending to “increase pensions.”

Specifically, Pesce rejected the criticism generated by the progressive records of the “Leliq ball”, stating that the sterilized amounts are less than those that existed in 2018 in relation to the size of the economy, in addition to assessing that the counterpart of that debt be the banks and not ordinary investors.

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