Despite last year's devaluation and due to inflation that does not give, The main banks of the world believe that the "weight is still expensive" and they are worried that exports will not grow more, which prevents the country from receiving capital from abroad, according to a report by the International Finance Organization (IIF, according to its acronym in English), the global society that brings together the largest financial institutions in the world.
Last year, the current level of current account deficit (5% of GDP in 2017), or how investors commented that the country consumes more dollars that could not produce, has led to a strong running against the weight.
The red current account (or foreign exchange requirement) is adjusted to half this year, after last year's discount, but the IIF considers it to be done by reducing imports and not an increase in exports. And that adjustment was made "at the expense of the level of activity."
"The majority of the current account adjustment have to base the equal economic restriction and import compression. The rebalancing of this current account has not been a refund of valid export, but rather compressed importing. We believe that real export resilience will take some time"he said Jonathan Fortun, an economist in the IIF, a Infobae.
"LFast depreciation in 2018 has compressed imports In the country, which has led to a significant economic slowdown (which affects drinking and economic activity), the country's commercial balance has been more on the side of imports than exports, "added Fortun, who understands That level of inflation that makes exports less competitive.
Given this dynamic, banks are considering that for Argentina "reaching new capital to the country will be slower, so Central Bank intervention will have to holdhi"In a context where the United States Federal Reserve reduces the speed of interest rates that benefit from emerging countries, Fortun explained.
This difficulty is reflected in attracting capital from abroad at the high level of risk in the country. "The most important variation is the danger of the country. The basic problem is that it is very high. As long as it does not go down, the activity level can not start because if imports start, the current lack of account is expanding, you need more dollars and the market does not give them, "he said. Martin Vauthier, or EcoGo.
The economist understands that there are two methods to save the current account to adjust: the interest rate and the exchange rate, two variables that have been reorganized in the last week.
"What is kept in the current account deficit was the interest rate, which included the credit, level of activity and, therefore, imported. But When the market saw that the Central Bank dropped rates, the exchange rate responded. And with the new increase in interest rates, the exchange rate returned, "he added.
For your colleague Federico Furiase, The eThe multilateral real exchange rate is now 15% higher than December 17, 2015 with the departure of stocks and discounts. "We have had a five-month commercial rest of goods that halted the lack of tourism," he said, as he expects a current lack of account of around 2.3% of GDP, consistent with a trade surplus of goods around to USD 7,000 million.
Understand that it is logical the stabilization process itself causes the dollar to move behind inflation and losing some of the exchange rate cushion earned with the reduction in the recovery value, in accordance with recover the real salary. But it's not a new forecast dollar increase to improve the real exchange rate in the medium term, because it will filter quickly to inflation.
"The challenge is to maintain competitiveness, it will change to boost investment in the sectors that produce dollars through exports, reducing inflation in a continuous way, which is a demand for comparative prices aligned and a reduction in public spending to reduce the deficit, a condition necessary to lower the risk of the lower country and the cost of financing, "said Furiase.
In the meantime, The highest real rate, financial tightening through the high rate and reduction in working capital in real terms of 30% per annum take fuel out of the private sector foreign currency.