The path the dollar goes through all year is not expected by anyone. Estimates of major economic consultants predict that the value of the American currency will be in December 2018 from 20 pesos. That number, even, is in the 2018 Budget projection presented by the ruling party. The reality is very different. Weights suffer the most devaluation since 2002 and the increase in currency is 105.3% throughout the year.
On the last day of the year, the dollar fell nearly 80 cents compared to the previous day to start an activity-free weekend on the market at $ 38.84, with the benchmark interest rate approaching 60 percent. The decline is very marked in the wholesale market, where the currency starts the wheel to $ 38.20 and close at $ 37.67.
The Central Bank quoted buyers of $ 36.90 and sellers of $ 38.84 this Friday, when on December 29, 2017 the price was $ 18.42 and $ 18.92 for both ends. In this way, the US currency increases something more than 105% during the third year of Mauricio Macri's management, the brand will be the highest in national history.
The impact of the introduction of financial income taxes and state risks at the maximum level in four years adds to the part of local uncertainty at the time where investors are rearrange their portfolios. On Thursday, for example, the currency reversed initial gains and closed with a 30-cent decline in the wholesale segment, while institutional investors gave settled dollars in high-yielding peso bonds.
Reasons for instability
The constant swing of the American currency is surrounded not only by the economic instability that has remained so far, but also by the political changes generated by currency distortion. There are two major changes to the Central Bank's headline, two agreements with the National Monetary Fund for money loans, radical changes in cabinet physiognomy and a central adjustment policy that projects a zero deficit for 2019 in the budget.
There are several reasons why the dollar doubles its value in the last 365 days. The first signs of a larger request for US currency occur a few days before the turn of 2017. On December 29, at a press conference, Chief of Staff Marcos Peña, Minister of Finance, Nicolas Dujovne, and Former officials Luis Caputo and Federico Sturzenegger, change the "inflation goal" for 2018.
The size is visible "relaxed" monetary policy and reduce interest rates on pesos to stimulate economic growth. It didn't work The dollar began to rise little by little, spending 20 pesos and slowly, Central began to intervene in the market to avoid a rise.
In May, the first critical situation occurred. Mauricio Macri announced that the Government I will ask for a loan with the IMF, in the midst of a violent economic storm. The dollar rose to 25 pesos in a few days, with strong detention from Central led by Sturzenegger at that time.
Little by little, the dollar continues its bullish journey. After the departure of Sturzenegger, Central presidency it's in hand by Luis Caputo. For several weeks, the currency was stable. But some of the tailings produced by commercial tensions between Turkey, which led to the devaluation of the lira, produced more instability.
Then, Macri announced changes in financial programs with the IMF. The dollar rises again more than 34 pesos and it has another devaluation effect in weight. Caputo left his position and entered Central Guido Sandleris, who, within a few weeks, announced a different system to hold back the rise in the US currency.
Central began implementing the so-called dollar "flotation band", which it used to put roofs and floor references on currencies. In terms of discussing these numbers, the Bank will intervene in buying or selling, as needed. Since this system was founded, so far, the value fluctuates between 36 and 42 pesos, to end the year at $ 38.85.
The entity, in addition, applies another measure that allows dry money to market. The "emptiness" of the Central peso makes it possible so far, through daily tenders, to sell to financial instrument banks called Leliq.