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Between two fires: investors and savers move from bonds to dollars because of the global crisis and country risks

The dollar rose without a break from the start. But the difference between Argentina and other markets is that the euro and other currencies begin to impose the dollar and give way several hours before it closes. The United States currency opened lower against six major currencies and fell to 0.12%, but closed 0.50% above.

The currency accompanies the recovery of local stock exchanges which, in the face of the best consumer data, began to recover some of the lost land.

It is a tradition that since Christmas the New York Stock Exchange has risen until the end of the year. What's more December is always a tame month for those who bet on shares, but 2018 breaks the tradition of almost 100 years.

The increase in Wall Street is for some "dead cat reflections" and for others the extension of the Christmas tradition. The truth is that the increase is consistent.

The S & P 500, the most representative and broadest Wall Street index, rose 4.96%, although in that year accumulated losses were above 10% and 20% if measured since last September. Dow Jones closed with an increase of 4.98% and Nasdaq not less than 5.84%.

The dollar along the wheels is strengthened in the world.

In Buenos Aires, in banks and exchange houses it rose 45 cents to $ 39.48. In turn, wholesale dollars, which start the day under $ 38, closed at $ 38.70, which means growth of no less than 69 cents. "Blue" has a strong 4.52% rise and surpasses the $ 40 limit at the end of the round at $ 40.50.

Increased risk of the country has caused bond issuance. The peso obtained when selling public securities is converted into dollars in the legal market and in marginal markets, there is an increase in the number of businesses in the wholesale market where more than USD 700 million is negotiated.

Investors are looking for coverage because they are among two local fires, which translates into the highest country risk since 2014 and those from overseas where VIX, an indicator that measures volatility and is known as a "fear index", He passed a daunting barrier of 30 points to close at 30.41.

This indicator is formed by variations in the price of raw materials in the Chicago market where soybeans fell 1.61% to USD 319.69 per ton. Soybeans and corn lose the same percentage. But oil has a revival of 8.68%. The opposite behavior of crude oil and grains marks the volatility of the index.

But this Argentine drama is at risk of the country. It is one of the three highest in the world. The other two countries (except Venezuela) are on the African continent. Risk increases to 833 basis points, it increased by 0.48% because the 10-year US Treasury Bond, which is a benchmark for measuring risk, increased 1.75% and the yield dropped to 2.80%.

Although in Argentina debt bonds rose, they did so in a third of what was a dollar increase. Bonar 2024, a benchmark, rose 0.60% against the wholesale dollar increase against 1.81% pesos. The proportion of increase is more noticeable compared to the fall of 0.40% from the real dollar in Brazil.

Another concern for the Government might be the monetary plan. If the investor does not renew the fixed conditions with the same strength as before, there will be pesos that are released to buy dollars.

For example, in the Liquidity Letters (Leliq) offering, $ 119,755 million was arrested with a cutting rate of 59.85% per year, which was only 0.03 points lower than the last working day, last Friday. But the problem is that from here at the end of the year they had to wipe out the $ 3 billion daily circulation through Leliq and this time they not only did not reach that goal, but they expanded the circulation to almost $ 1,000 million because they could not renew the maturity of the whole

Reserves, meanwhile, increased by USD 6 million to 66,330 million. The rise of state bonds from other countries resulted in 86 million. Outside, only 3 million is paid.

The free-fall stock market – at 13.15 was below 3.72% – reversing the trend and the Merval index of leading shares rose 0.06%. The rise of oil is the key. YPF, one of the highest weighting papers to make Merval, leading stock index, up 4.91% and Metrogas, 3.05%.

On Wall Street, Argentina's ADR has a good turn. Shareholding certificates, the most prominent of which is a certificate from MercadoLibre (+ 9.46%), which cuts a drop of more than 10% on Monday, Banco Macro (+ 7.76%), France (+ 7.02%)), Edenor (+ 6.74%) and YPF (+ 9.43%).

On the other hand, in the Lecer tenders (letters that index for living expenses) up to 56 days and letters that can be loaded in Pesos (Lecap) to 105 and 182 days with rates of 3.75% and 35% each month, they attract around $ 3 billion. Maturity is $ 38 billion and the title is placed for $ 40,600 million where we have to add $ 2,758 million from the letter indexed by the CER. This is in accordance with what the Central Bank wants to collect. The lower price paid, because with these titles savers avoid paying 0.50% of Personal property tax. The tax must be added to the exchange rate.

There are 48 hours to the end of the year and eyes are on the 2019 future dollar. The increase on Wednesday is a warning for the monetary plan.

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