Thursday , December 3 2020

Dollars to the mattress, peso to the banks: and the end of the recession? – 25.11.2018



The Organization for Economic Cooperation and Development (OECD) expected that after a strong momentum in the last two years, the world economy is about to slow down.

The Commerce War of The United States and China (a key moment at the G20 summit in Buenos Aires this week), the consequences of the UK's exit from the European Union and the potential rise in the US bond rate. They aim to complicate the global economic landscape.

Developing countries will pay some of the consequences of these changes in the developed world, and in this context Argentina will play its game the extra to make it in the election year.

As part of this cocktail is an integral part of the process of adjusting the Argentine economy, hand in hand the dollar's money between June and September, as the international market has cut the country's funding.

Over the last seven weeks and after extraordinary assistance (amount, $ 57.1 million and speed) of the currency fund, the government managed to stabilize the stock market.

This result is related to two financial results: a USD of $ 36.63, up from just 0.1% in one month, as well as a strong increase in deposits of individuals in banks.

The exchange rate calm, even, leads to some predictions, from the study Orlando Ferreres, for example, let's start talking about inflation in November could be closer to 2.5% of 3%, which the government appreciated as optimal.

A quieter dollar would help slow down the rise in prices after inflation, weakening the purchasing power of wages.

The calm, as well as the tradition in Argentina, has led to the transfer of part of the dollar, accumulated in times of uncertainty, to the pseudo positions in the financial system.

From the comparison of the evolution of deposits and private loans in pesos made by the survey Ricardo Arezzo Fixed conditions appear to have risen by 282% between October and September.

Deposits in dollars also rose, but in this case, placements in a savings account,

Rapid reading shows that those who are betting at high peso rates tend to risk more than the dollar holders who deposit them into bills to make them closer.

But the relevant fact is that whether it's a peso or a dollar, deposits are rising, while loans on the other side of a bank's real estate are falling sharply.

In pCredits in pesos fell by $ 21,344 million between September and October and continues to fall in the first week of November.

Credit in dollars (remember that banks can only agree with companies or export activities) is dropped nearly $ 600 million in September and continued to fall in about $ 300 million in October and early November.

The banks' accounts are that they capture dollars, that most of them are deployed by the Central Bank, and in the hilt of the peso they accept private sector deposits that are largely in Liquidity Texts (Leliq) of the Central Bank, which now pay around 61.7% per annum.

This result is sought Guido Sandleris, the president of the Central Bank, to achieve its goal of zero-rise money in an attempt to keep the dollar and inflation to calm down.

A picture of this reality shows that much of the Argentine dollars are still in the mattress, that another has gone to the pesos and is in the banks, but these deposits they do not become loansExpectations to exit the recession without credit growth are in vain. How long will be the handbrake activity?


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