The drain of foreign currency through the daily sales of the Central Bank in the official exchange market to supply the demand deepened this Wednesday and Concern grows over the critical level of net reserves which, according to some private calculations, I would already be in negative territory. Likewise, the stock of gross international reserves at the close of yesterday reached $35,078 million, the lowest amount since October 2016.
The monetary entity extended the selling streak for the fifth day in a row in the single free exchange market (MULC) by registering a negative net balance of US$125 million.
The unfavorable result occurred despite an improvement in the volume liquidated by agro-exporters under the soybean 3 dollar scheme. They contributed foreign currency for US$99.04 million, the highest amount since last April 24, prior to the bull run. the last week of the parallel dollars.
Reserves: Follow the bleeding of dollars
The BCRA registered this Wednesday a net sales u$s125 million, with which the monetary entity adds a negative balance of US$258 million in the first two rounds of May.
The monetary entity extends the selling streak for the fifth consecutive day, an unprecedented event under the two previous soybean dollar schemes that governed in September and December 2022.
The operator Gustavo Quintanafrom Pr Cambios pointed out that “in a day in which new energy import payments were registered, this time for some US$60 million, the BCRA had to use its own resources again to attend the needs of the market”.
The BCRA registered today a net sales balance of US$125 million, and extends sales streak for five days in a row
After registering net purchases in the MULC in April for barely US$35 million, the monetary institution so far this year a balance of net sales of around US$3,226 million.
On the bulky level of sales of US$258 million in just two business days in May, market sources attribute it to the fact that “in these first two days of May demand for dollar savings was concentrated, which is seasonally high in the first days of each month and after the first week it tends to be zero”.
“On the first business day it was US$43 million and today a similar amount is estimated,” commented. And they noted that “there is also a concentration of import payments in these first days with a decreasing trend.
The director of EconViews and former Secretary of Finance Miguel Kiguel criticized through his Twitter account: “They continue to sell (dollars) to hoard, to travel abroad, for imports at discount prices, and meanwhile andThe BCRA is already with negative net reserves and asking for handouts in Brazil, China and the IMF”.
In addition, Kiguel assured in an interview with the Noticias Argentinas agency that “the exchange rate is completely behind schedule” and that “there is no way to increase the reserves while this continues.”
“We are going to spend the US$5,000 million of the swap with China, all the money from the disbursements of the IDB, the World Bank and the CAF or whoever disburses money for Argentina and we continue to lose dollars. The prospect looks very ugly,” he warned.
Analysts estimate that the stock of net reserves is already in negative territory
In this sense, a report PPI estimated that net reserves closed last week “at US$182 million after the payment to the IMF for US$690 million” and estimated that the interest payment for US$644 million scheduled this last Tuesday with the IMF, “would send the reserves into negative territory for the first time since February 2022, prior agreement with the IMF.”
Agro dollar: after liquidation
Agriculture contributed this Wednesday an income of US$99.040 million under the soybean 3 dollar, the highest amount since last April 24. The improvement in the rate of settlement in relation to the US$54 million settled the day before was registered within the framework of a calmer financial day in which the blue dollar fell $5 to close at $469 after the new restrictions that debuted on Tuesday to access financial dollars that affect traders and stockbrokers, but not savers.
Salvador Vitelli, specialist in finance and agribusiness, commented that “since April 24 there were no significant values, so from that point of view something else was liquidated, but It was not enough for the BCRA to retain currency, and that is what is worrying today, that it is not being able to keep any of the currency it buys”.
Since the entry into force on April 10 of the soybean dollar 3, the amount settled under this scheme totals more than US$1,760 million, For now, far from the Government’s objective of obtaining US$5,000 million with this measure that ends on May 31.
In addition to the impact of the drought, the price offered by exporters to producers -today around $100,000 per ton of soybeans- is not attractive for them to settle. And furthermore, the incentive to liquidate is reduced with each passing day as the crawling peg accelerates.
In that context, There is an expectation in the market that there will be some modification in the mechanism that will encourage greater liquidation.
Agriculture settled today US$99 million under the soybean 3 dollar, an improvement in volume compared to the last few days
“There are rumors of a possible negotiating table regarding an adjustment of the differential exchange rate that is being given to the sector to encourage a little more liquidations. There is nothing confirmed. Without a doubt, it would generate a little more incentive”, Vitelli recounted.
“To what extent would that be successful? It will depend on the value that is offered, logically, and it will also depend on how it is announced. Because ultimately, if the production sector asks for an increase, they will be giving, to what extent is it viable, since as long as a free similar dollar is not recognized, the producer is not going to be willing to sell at a dollar that is below the market price. It is where the push and pull of the negotiation with respect to a new exchange rate takes place,” explained the expert.
