Stop the dollar and open the game, goals of Lacunza

The central goal of the national government until December is to prevent the devaluation of the peso after falling 19% last week. There is no plan B on the monetary front, but President Mauricio Macri has lowered a guideline: we must create stability to prevent the crisis from taking an undesirable course.

Although the political election speech of the ruling party indicates that in Casa Rosada, it is hoped to win the October elections, other concepts are used in the praxis of the central administration: they speak "transition" and admit that markets are more attentive. to the opponent Alberto Fernández that in Macri.

In this scenario, the new Minister of Finance, Hernán Lacunza, was badumed yesterday. He expressed a serene message, without announcing specific measures, and said he had contacted the opposition economic leaders to collaborate in the quest for stability. It was the first time we recognized that the axis of general attention was no longer found only in Casa Rosada.

Macri asked in public. After taking the oath, he said: "I ask you, Hernán, to open all possible bridges and channels of dialogue with citizens and sectors so that we all work together to reduce the uncertainties that are still hurting. . " And he thanked her for accepting the job at such a difficult time.

The new national leader communicated with representatives of the Front de Tous, the Federal Consensus, Awakening, the United States and the Left. "We call for the preservation of stability as well above any electoral ambition, which can not be an excuse to undermine the well-being of Argentinians during the transition," he said.

Dollar

Lacunza swore, left Casa Rosada, crossed Hipólito Yrigoyen Street and entered the ministry for the first time. He went to the fifth floor and, after a 10-minute meeting with his team, went to the conference room where characters such as Domingo Cavallo, José Luis Machinea, Amado Boudou and Axel Kicillof.

"We are in a complex moment," said Lacunza. He explained to his team that it was clear: "The central mandate entrusted by the president is to guarantee the stability of the exchange rate as a first-rate goal in this election period." He added: "Stability is the public good that this Ministry of Finance has to offer."

In this regard, he said that there was sufficient reason to think that after last week's rally, the exchange rate "is higher than its equilibrium value". Official sources later said that the most appropriate price for the dollar today would be between 54 and 56 pesos.

Lacunza said "in Creole", so everyone understands: "You do not need a higher exchange rate". And he kept to the consensus of the badysts of the financial markets and, without dodging the clutter of the electoral race, in which he declared "the candidate who obtained the greatest number of votes in the primary elections", Alberto Fernández.

More inflation

Those who come will not be easy months. Lacunza anticipated it and, at a subsequent press conference, said Central Bank President Guido Sandleris: "We must be realistic, inflation will increase in August and September" . That would be around four percent a month, almost double the 2.2 percent of July.

The only one that can defend the value of the currency is the central bank. "Nominal and financial stability, both for the election period and for post-December 10, is our top priority," said Sandleris. And the contribution of the Treasury will be to guarantee the achievement of the budgetary objectives established with the International Monetary Fund, with which Lacunza met Sunday afternoon.

During the interview, he explained to them that, according to the figures provided by his predecessor, Nicolás Dujovne, incomes increased by 14 points above expenses, which will give a surplus of primary results of 21 billion third quarter and five one billion pesos the budget balance model.

Yesterday again, after long weeks of silence, the Fund appeared in a message from its spokesman, Guerry Rice. "We are keeping a close eye on recent developments in Argentina and maintain an ongoing dialogue with the authorities in developing their political plans to address the difficult situation in the country", did he declare. And confirmed that "soon" the mission that was scheduled for Tuesday 20 will arrive in Buenos Aires.

He will bet on the interest rate as the main tool and sell dollars – as he did last week, when he injected $ 500 million – but without squandering his reserves. "Reserves will not be used to hold financial badet ratings away from their economic fundamentals," added Sandleris. In other words, they will not act in case of speculative market attack, because these phenomena tend to deflate.

According to Mr. Lacunza, the countercyclical measures announced last week do not compromise the achievement of fiscal targets, as they are "self-financing" and generate the highest revenues the government expects for the last four months of the year.

After that, the brand new minister opened the umbrella: "It is clear that the electoral process is not indifferent to the stability of the exchange. The market pays more attention to the future and not to the present. Sometimes what the opposition can say is more important than the government can do. "

Lacunza and Sandleris spoke with half an hour of difference, but the speeches were adjusted several times before that happened up to now in macro management. And both said that beyond the results of the polls, they intended to leave as macroeconomics as orderly as possible.

The Chief of the Treasury said one of his tasks during his 112 days of management would be to finish building a "platform" to "bequeathed in the transition" consisting of orderly public accounts, primary budget balance, external balance bank, competitive exchange rate and rates already corrected.