Stir for a survey that helped increase country risk – 19/04/2019

The increase in the country risk rate Thursday continues to be commented during the long weekend and increases the waiting for the opening of markets on Monday.

The 8% drop in inventories Argentine companies and banks operating abroad was accompanied by a further decline in bond prices and to climb to 851 points country risk rate above 850, reaching record levels.

This rate, an indicator of self-confidence about the possibilities of paying a country's debt, indicates that Argentina should pay 8.5 points more on the US rate. In practice, this reflects the impossibility for the country to obtain other external financing than that of the Monetary Fund.

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The decline of Argentine bonds abroad has determined that your income will reach 15% per annum in dollars, a very high price for those who want to take risks. And the mandatory question is why a new wave of mistrust was generated just after the government announced measures to improve consumption.

The major outside operators attributed an exceptional role to investigation that the consultant isonomy – who usually works for Casa Rosada– distributed among its customers that Cristina Kirchner I will beat him Mauricio Macri in a ballot.

The numbers are 45% against 36% and it would be the first investigation that risks this result. The fear of a return of CFK to the government scares investors despite Kirchner's efforts to be more "friendly" with the IMF, the markets and the country's debt payments.

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Those close to Axel KicillofFor example, they say that the former minister is no longer talking about breaking with the IMF and points out that Kirchner has paid off the debt (he leaves of course the default he left) and acknowledges that the Financing 2020 for Argentina, it is badured.

The Baglini theorem (policies reduce the amount of nonsense when they see the possibility of approaching power), it is reinforced by an inquiry and a reality: at this stage of the Macri government, there is a high dollar, the trade surplus, increase energy exports, Rates are not late and the Treasury tends to balance its accounts.

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That's another 2019 macrobut politics picks up the economy in the election year and even more when it becomes very palpable the decline in real wages, consumption, economic activity and everything that is marked by an inflationary process without respite.

Some foreign operators also argued that the country's risk of rising was due to the president's enforcement of measures that would have already provided the Kirchner. It seems that markets are wary of Mauricio Macri can make decisions to try to win the elections.

The 4.7% increase in the cost of living in March, it exceeded its expectations and those of others and resulted in an emergency agreement with 16 companies to freeze the prices of 60 products in the basket of necessities for 60 days.

The list of these products (oils, flour, rice, canned goods, wine, beer, biscuits, jams and water) reflects a well – known but remarkable thing in the current context: these are prices that depend to a large extent on the price. evolution of the dollar.

It dollar-food link will again be put to the test in Argentina with the entry into force of the new "care prices" and the new "virtual" ceiling of the exchange rate band.

The central bank has frozen until the end of the year the band that states that the dollar has a "floor" at $ 39.75 and a "ceiling" at $ 51.45. In the middle, that is to say that on a possible variation of 29%, it will not intervene; the Minister of the Economy, Nicolás Dujovne, did not get this concession from the IMF.

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Maybe that's why the central bank has announced Guido Sandleris During his last press conference, he played to intensify the monetary tourniquet. Until June, the plant will not buy any dollars if the currency is trading less than $ 39 on the wholesale market to avoid issuing more pesos and favoring a rise in interest rates on fixed terms.

The entire diet is based on no pesos buy dollars, but politics intensifies the electoral time and, as always, can queue.