The BCRA expected it to take the key step of dismantling dollar shares.

He Central Bank of the Argentine Republic (BCRA) announced that it is considering the possibility of opening the following tenders for Free Argentina Restoration Bonds (Bopreal) companies who want receive profits and/or dividends to its headquarters abroad. This is the first step in fulfilling one of the main requirements of large companies operating in the country – to begin dismantling exchange rate.

“The BCRA is assessing the possibility of opening subscriptions to upcoming tenders for companies that require distribution of profits and/or dividends to non-resident shareholders. This concept requires prior approval from the BCRA to access Free exchange market from September 2019. The next auction is expected to take place on the week of May 6,” the monetary authority said in a statement.

They clarified that the Bopreal 3rd series was won for $1.197 million since the opening of bidding for this site. It is worth remembering that these securities are subscribed for in pesos, payable in dollars, bear interest at a nominal annual rate of 3% and are amortized in three quarterly installments, from November 2025 to May 2026.

“Series 3 auctions were open to all importers in arrears for imports of goods and services as of December 12, 2023, regardless of whether they have recorded outstanding balances in Register of commercial import debt to foreign suppliers“added the monetary authorities.

The BCRA will now open up access to these securities to companies wishing to remit dividends overseas, expected from September 2019.”The company estimates corporate dividends to be between $5,000 million and $7,000 million. “They are trapped in the country’s tightly regulated currency market, becoming a major obstacle to lifting those same restrictions, according to two people familiar with the matter who requested anonymity to disclose information that has not yet been made public,” Bloomberg reported. .

The government’s economic team insists that they will not move in the short term to lift the current restrictions on retailers operating in financial dollars, much less in official ones. The priority is to continue building reserves, which were $4.1 billion negative as of April 19, the BCRA recently reported.

The explanation he gave Information A senior official on the economics team responds the same way he does when asked about the complete abolition of foreign exchange controls, or so-called reserves: “The risks and costs are still very high. Restrictions act as a restraint on markets that are not in equilibrium. You need to balance them first and then consider raising them.”

Fear of a possible surge in free exchange rates is fueling expectations of devaluation, with the gap remaining around 20% and the official dollar stabilizing. Instability will jeopardize the continued slowdown in inflation, which stood at 287.9% per annum in March.

The government argues that the price of the dollar is acceptable to run with a budget surplus and a central bank that buys reserves. While this level is specific to the stock, they note that this development contrasts with what happened prior to December 10th. This is the framework conveyed by the Minister of Economy, Louis Caputoin his dialogues with businessmen, especially representatives of mass consumption, whom he asks to curtail growth.

Together with the Ministry of Economy and the Monetary Authority National Securities Commission (CNV), chaired by Roberto Silva, has identified rules whose repeal requires greater urgency. They are relevant to the bond market, especially those that are part of the dollar converted with settlement (CCL).

• One is the added daily limit of $200 million on transactions or transfers of securities used in the purchase and sale of financial dollars, as well as an obligation to report transactions five days in advance. T
• Also in focus is the minimum bond holding period, known as “parking,” which is 1 day and can drop to zero, and the inability to use collateral.
• Another option requires that securities sold for dollars be deposited with a banking institution.
• There are a number of other measures that include obstacles Funds of Investment (FCI).

At the same time, a roadmap for the dismantling of reserves is being formed, which will be submitted for consideration in June International Monetary Fund (IMF). There is still hope that an agreement will be reached to provide new funds for this mission, but the organization does not agree with the pace creeping peg 2% monthly and interest rates in negative territory.