The Board of Directors of the Central Bank of Argentina (BCRA) said this Friday that it had adjusted the valuation of the Treasury’s assets in its assets “with the aim of ensuring the integrity and improving the quality of the institution’s information”, which led to the recognition of losses. about 41.715 million euros.
These accounting estimate adjustments meant that as of December 31, 2023, a loss of AAR 41.55 billion was recognized in respect of non-transferable notes and PHP 2.31 billion in respect of temporary advances (approximately US$45,000 million in Total), said A. statement from the subject released this Friday.
Integrity is a consequence of a monetary organization adapting its accounting policies, whose “main impact” fell on the score “Non-transferable bills and other government treasury bills” in US dollars and “Temporary Advances to the National Government” held in its assets.
The BCRA clarified that previously, for the valuation of non-transferable notes “technical value” and for temporary advances“face value”, two criteria not accepted by current Argentine professional accounting standards.
Based on the financial statements as of December 31, 2023, the monetary authority has determined that the public sector impact will occur. at “depreciated cost subject to the recoverable cost limit”in accordance with current professional accounting standards in Argentina.
The disclosure resulted in a loss because the Argentine sovereign securities that the Treasury transferred to BCRA to obtain financing They cost 40% of their face value on the market.
“And then they deny that they left hyperinflation… if they weren’t so crude in terms of monetary analysis, they would know that the downside of central bank failure is a much higher price level (hence hyperinflation). ..” , published by Argentine President Javier Miley. in his X account regarding the deterioration of the balance sheet of the monetary entity he inherited when he took office on December 10th.
He recognition of loss of property “eliminates the possibility of resorting to accounting profit transfers (which poorly reflect the true economic and financial position of the Institution) as an alternative cash financing mechanism to the Treasury consistent with its commitments to zero deficits and the elimination of cash financing,” said BCRA, whose 2023 balance sheet showed a loss of 4.336 million pesos (4.56 million euros).
The organization, led by Santiago Bausili, is seeking to clean up the BCRA’s balance sheet, which it inherited with negative net international reserves, money creation to finance the treasury and the monetary body’s explosive debt to banks, in order to lower interest rates. inflation, still in triple digits, stood at 287.9% year-on-year in March last year.
BCRA has purchased more than $15 billion. Since Mealey took office, he has defunded the Treasury and surrendered the debt to the BCRA.
“This adaptation represents first step towards the presentation of financial statements based on International Financial Reporting Standards (IFRS),” the BCRA said.
Goodbye wheat and corn export ceiling
On the other hand, Argentina, one of the largest producers and exporters of agricultural products in the world, canceled the system of equilibrium volumes for wheat and cornthrough a decree of the Ministry of Economy published this Friday in the Official Gazette.
The Bioeconomy Secretariat said in a statement that by withdrawing the 2022 standard, “it seeks to end one of more distorting instruments commodity market”.
A 2022 standard set export quotas “to purportedly protect the domestic market,” recalls Bioeconomía, as it set export records for wheat and corn to decouple domestic prices from rising external prices.
The resolution was published this Friday “removed this instrument that imposed restrictions on exports”clarified the briefcase.
“Deregulation had a negative impact on the functioning of grain markets, since generate lower prices, production and exports“and worsened relations with major trading partner countries” and “proved to be ineffective in controlling food prices and brought results opposite to those desired,” Bioeconomy pointed out.
Estimates for the 2023/24 corn production campaign are 47.5 million tons and wheat production reaches 14.5 million tonsAccording to the Rosario Stock Exchange.
The Buenos Aires stock exchange fell 1.91%.
As for the stock market, the S&P Merval index of shares of leading companies listed on the Buenos Aires Stock Exchange closed lower this Friday. decrease by 1.91%, to 1,407,510.54 units.. Meanwhile, the overall S&P BYMA index closed higher. decrease by 2.04%at the level of 59,877,525.26 points.
The volume of the stock trading business amounted to 9.119 million pesos (approx. 9.6 million euros), with a balance 40 articles on the rise35 down and four no changes in the overall panel.
Among the top performers, YPF stock fell the most. (-6.8%), Pampa Energy (-3.89%) and Puerto Central (-3.6%). In contrast, Aluar (9.08%), Banco de Valores (8%) and Ternium Argentina (4.87%) closed in positive territory.
Argentine government securities fell 0.3% on average in their dollar quotations, while Argentina’s Country Risk Index rose to 1,272 basis points.
On the official foreign exchange market The US dollar in the state-owned Banco Nación rose by 50 cents pesos at P861.50 for purchase and P901.50 for sale to the public, the same as in the wholesale market where it closed at P882.50 per unit.
In the informal foreign exchange market, the parallel or “blue” exchange rate lost five pesos at 1,040 pesos per dollar, while so-called financial dollars trended lower that day.
“Calculation” dollar (CCL, consisting of buy stocks or bonds locally with Argentine pesos and sell them for dollars on Wall Street) fell 0.5% to P1,078.41 per unit.
Meanwhile, the “stock market dollar” or “MEP dollar” (which is obtained by purchasing assets listed in both pesos and dollars, is paid in pesos upon acquisition and is traded in dollars on the Argentine stock market) fell by 1%, to 1,035.73 pesos per dollar.