Friday , January 15 2021

The central bank has presented its best balance for six years, but the reserves are worrying

For assets, mainly in foreign currency and liabilities, the movement of the dollar – which is decisive for the economic and financial debate of 2018 – left a central bank balance balanced by the effects of "liquefaction" and the disappearance of Lebac.

According to the latter Summary of assets and liabilities of the Central, up to November 30, Leliq shares reached $ 711,436.7 millionIf you add the remainder of Lebac for about $ 116,318 million. BCRA's debt securities amounted to 832,686.5 million pesos,

This amount represents 67.2% of all the money the economy operates, Money base (currency in circulation, cancellations and current account deposits), for 1,238,890.7 million pesos, The entity is committed to maintaining this level of monetary base by June 2019.

Subject to active of the Central Balance, Leliq and Lebac account for 42.8% of the reserves international measures in pesos, to $ 1946453.9 million since November 30 ($ 51.193 million at the $ 38.0217 exchange rate).

As a consequence of abrupt devaluation of the Argentine peso in 2018, over 50%, and the sale of reserves for disarm of trade from April 25, which ended in practice with the disappearance of Lebacs, the level of BACR paid liabilities in respect of reserves fell from 111% on April 23 to 42.8% on November 30,

It should be remembered that stock of Lebac which reached April 23rd $ 1,377,767.4 million, in front of international reserves for $ 1,238,723.8 million ($ 61.185 million, at an exchange rate of $ 20.25 per dollar).

as debt in the balance sheet of the enterprise, equivalent to more than $ 60,000,000 or 11% of GDP, with a high interest rate above the foreign currency assets, triggered turbulence in the financial market, with a dollar that doubled its value for five months to exceeds 41 pesos on September 28.

The best balance since 2012

That is right to return six years to find such a low link between payables and reserves. According to the Central Balance Sheet on 7 December 2012 reservations international measures in pesos have reached $ 220,707.3 million ($ 45,397 million, at an exchange rate of $ 4,928) until securities issued by BCRA (Letters in local and foreign currency) USD 96,312.4 million, 43.6% of these reserves.

The monetary authority argues that with the current monetary policy regime in place since October, the arrival of Guido Sandleris to the chairmanship of the " several factors that support sustainability of these obligations. "

"In the recent months, the balance of the Central Bank falls both in terms of GDP and international reserves, with which the starting point gives more room for maneuvering the new monetary policy, "says Central.

Between April and September, Argentina's central bank liabilities, including letters, notes and omissions, fell from 11.2% of GDP to 5.6% of GDP, while the ratio to international reserves increased from 110% to 40%. percent.

"This dynamics is explained first and foremost by the decline in Lebac demand from the non-banking private sector since the beginning of the financial turmoil in April and later by the Lebac disarmament program implemented by the bank Centrally in August In the case of a ratio to international reserves , the increase registered at the exchange rate during this period also affected ", summed up the currency.

The weakness of the reserves

The panorama of the Central Bank is still visible many difficulties, C a interest rate below 60% In the pesos, the increase in liabilities increases at a faster pace than the dollar, resulting in a gradual deterioration of the balance.

On the other hand, the needs of the Argentine economy recovery of the current account surplus – Trade and tourism and services, so net income from dollars consolidate reserves BCRA in a true way and relinquished dependence on external credit as a source of foreign currency.

Today the international assets of the Central are close to $ 50,000 million, but this composition includes Payment by the IMF, which are available only for payment of debt, "swap" with China, a loan from the Bank of Basel, remainder from REPO with banks and deposits private in foreign currency.

Therefore, net international reserves reached reached $ 14.771 million until November 23, according to the calculations Balance Capital, This is an amount that barely covers five months of import,

Balance said that "in October and November BCRA did not participate in the stock market. variations in reserves international are due two factors: IMF transfers and debt payments ",

"The net reserves (reduced liabilities with the private sector, multilateral organizations and REPO, loans from banks, bonds with bonds) stable about $ 14,700,000 in November"he said.

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