Financial day: The free dollar rose to $386 after strong BCRA selling in the market

Financial day: The free dollar rose to $386 after strong BCRA selling in the market

BCRA records net sales of over $2.2 billion in 2023.

The Argentinian financial market showed general weakness on Monday due to its own exchange rate tensions and fears over the global banking reality, which is hardening the positioning of risky investors.

He central bank ended with a seller’s balance of approximately 261 million USD due to the market’s own demand, the largest daily decline in foreign currencies since mid-February last year, which gave it a further bullish push towards the free dollar.

“The BCRA had a short position of $261 million in the foreign exchange market and $680 million of credits from CAF and CABEI entered the reserves. The credits enter without going through the market, which is why the seller swings” on the wholesale market, he explained to Reuters an official source. Under those moves, reserves rose $342 million from Friday and ended the day at $38,007 million.

“During the day, they entered the market YPF for $20 million for the payment of a marketable bond, the government of Santa Fe for $26 million for a provincial bond and Enarsa for 261 million dollars for the advance payment of Liquefied Natural Gas. These payments were expected and do not change the BCRA’s forecast for the first quarter of the year,” market sources said.

The BCRA chained eleven consecutive days with a negative balance due to its participation in the stock market and the ratings in Net sales of $1,139 million in March in the MULC and during 2023 the negative balance reached 2,221 million dollars.

“In the first quarter, we will have had $6,000 million less in farm liquidations. The comparison with the next three quarters will probably be worse,” he said. Martin PoloCohen’s chief economist, and noted that “the downfall floor for all of 2023 is around 20,000 million”.

In the meantime, the final approval of the Board of Directors is awaited. Monetary Fund International (IMF) to release USD 5,300 million based on targets achieved by Q4 2022, as part of the USD 44,000 million deal signed a year ago by the President’s government Alberto Fernandez.

Doubts are thriving over the future of the economy, which is afflicted by inflation rising 100% per year and a long drought that is affecting exports with its impact on BCRA reserves.

He the free dollar ended with a gain of three pesos on Monday, at $386 for sale on the reduced parallel market, a nominal record which had already been reached on January 27. The currency increased its rise in the last business hour, after learning that the BCRA had intervened with strong selling in the MULC.

The free dollar is now holding up 11 pesos or 2.9% so far in March. In 2023, it accumulates an increase of 41 pesos or 11.8%, still below inflation for the period, of around 17%. With a big dollar that brought in 1.19 pesos on the day at $204.53, the the exchange difference remained at 88.7 percent.

International stock exchanges were trading on an uptrend on Monday amid a complex financial panorama, but Argentine assets failed to join the trend.

indicators of Wall Street is up 1.2%led by the Dow Jones Industrials, while the S&P Merval of the Buenos Aires Stock Exchange subtracted 0.3%, to 221,059 points at closing.

This weekend’s operation to reverse the crisis of confidence was much broader than last Sunday’s. It was no longer just decided between Washington and New York, but also involved the Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank (ECB) and the Swiss National Bank, which announced that they would thus offer numerous operations of swap or currency swaps as needed to help foreign banks access US dollar funding for one week through April. And instead of being weekly, these operations will be daily.

Source: Rava Bursátil-accurate in dollars.
Source: Rava Bursátil-accurate in dollars.

Monday’s global recovery was partial for sovereign debt. Global dollar bonds ended mixed on Wall Street, with a countries at risk of JP Morgan, which sold five units to Argentina, in 2,383 stitches Bases at 5:15 p.m.

Sovereign bonds on the Electronic Open Market (AEM) fell 0.9% on average in pesos terms, driven by dollarized issuances due to higher global risk aversion, rising inflation having favored bonds in pesos.

This Wednesday, the Treasury will hold a bond tender to cover maturities, which are mostly in private hands, analysts said, after a recent swap to clear short-term bonds.

The focus on assets continues to focus on two axes: the continuation of the global financial crisis and the US Federal Reserve’s decision on Wednesday regarding its interest rate policy.

Continue reading:

Dollar Live Today: The free price has risen to $386, a nominal high it already hit in January
BCRA sold 261 million USD in the market today and the negative balance for March exceeded 1,100 million USD
Markets: the Argentine stock market falls and remains on the sidelines of the international recovery
Reasons Why The MEP Dollar Is Rising And Approaching $400
More liquidity for the BCRA: an additional $1,000 million of the swap with China was activated today

Melissa Galbraith
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