Critical week for the government: the dollar has increased in five days, as in March

Mauricio Macri may have had his worst week of the year: the president had to reaffirm his intention to be re-elected in October instead of opening up the possibility of "Plan V" he was forced to must speak for the first time of the country risk well without naming Cristina Kirchner and saw that the dollar has risen by nearly 4 pesos in just five currency wheels.

The government's critical week has actually started on Thursday, April 18th., which was declared day off in the country for Easter, but with a lot of action on Wall Street: the shares of Argentine companies listed on the New York Stock Exchange, such as banks, electricity and oil companies, dropped to 8%.

That day, moreover, several consultants have leaked poll results revealing a weakness of the action "Let's face the elections and the negative reaction of investors to the economic package launched by the government Wednesday 17" . Therefore, country risk climbed to 854 basis points. So he has returned to a level that has not been seen since 2014.

After the exchange holiday Thursday and Friday, the dollar jumped Monday to 70 cents. If Wednesday 17, it closed at $ 42.97, this Friday at $ 46.90, according to the average established by the Central Bank (BCRA) on the tables of banks and bureaux de change. So, solo five wheels accumulated $ 3.93 more (+ 9.1%), although at Banco Nación (BNA), it amounted to 4.10 USD (+ 9.5%). In March, it had risen by $ 4.26 (+ 10.7%).

Country risk also reacted: Thursday, he touched at 1,009 basis points and Friday at 967 points (+ 12.7%). At that time, the president spoke twice about the increase of this index. "It has risen because the world is afraid of the return of Argentina"said Wednesday at Venado Tuerto's Radio LT29 about Cristina's possible candidacy. "We must continue to row to overcome this electoral uncertainty," he added on Rosario radio Thursday.

This would mean, for example, that the state would have to validate 9.67 percentage points more than the interest rate applied in the United States. Given that 10-year bonds in this country currently have a return of 2.56%, this would imply that the government should validate a rate of over 12% approximately to seek funding abroad, which is considered a very large number.

The chief of staff, Marcos Peña, excluded Thursday We are already great changes in the political strategy facing the elections. "The candidate is Macri, there is no plan B", said the official without specifying whether this letter corresponded to a long, with reference to an alternative to the president, or a short, for Maria Eugenia Vidal. The president of Buenos Aires then made it clear to the businessmen: "I will be governor when they choose me again for the next four years".

For its part, the Central Bank (BCRA), besides the sale of dollars that the Ministry of Finance has received from the International Monetary Fund (IMF), has auctioned liquidity letters (Leliq): Monday, it negotiated at a average rate of 67.870%, but Friday it was 71.868% (+4 points).

President Macri closed the week with two very close meetings with his closest officials: Thursday at Casa Rosada and Friday at Quinta de Olivos. As Chief of Staff Marcos Peña baderted, the only thing that has happened is that the head of state has set a limit: "It does not matter. there will be no change of cabinet. "