The government mechanism to combat gaps is already more expensive than the mechanism of Massa and Guzman.

After the December devaluation The government has revised its intervention strategy to limit the currency gap and began to do this mainly through the introduction of a mixed dollar for exporters. The fact is that the currencies used in this containment mechanism are already equal to 80% of trade surplus and exceeds what Sergio Massa and Martin Guzman spent in their administrations as ministers on interfering with exchange rates.

The estimate is based on Periphery Center Consultantwhich reflected that “excess supplydollars, which was achieved thanks to the blend dollar, in situations that could mean failure (withdrawal of the consolidated law or rejection of the DNU in the Senate), it could contain quotes.

There are two mechanisms for containing the exchange gap: Export Increase Program (PIE), mainly and support for dollar payments based tourism and consumption in map foreigners in the financial market (dollar MEP) as a strong addition.

Massa and Guzman: how much each spent to contain the gap

This currency gap control mechanism assumes that a significant portion of dollars, which “can be purchased by the BCRA, will satisfy private demand in financial markets”, Contact your consultant for details.

The combination of these two mechanisms provides a parallel market with dollar reserves of approximately US$1.3 billion per month. In turn, according to the consulting firm, taking into account the continued restrictions on the activities of the National Securities Commission (CNV), Demand amounting to between US$900 and US$1,200 million per month is directed to.

The scale of dollar supply focused on the financial front dwarfs the intervention that former Economy Ministers Martin Guzman and Sergio Massa made in the financial dollar market to contain the currency gap.

It should be remembered that both officials’ method of intervention was the direct sale of dollars from the BCRA. This mechanism represented the average sale US$192 million per month (with a peak of US$400 million between 2020 and 2021) during the Guzmán era and on average US$667 million per month with Massa (peaking in the 2023 election period at US$1.8 billion).

What is the cost of closing the BCRA gap?

“Sacrifice each month with the amount contributed by Louis Caputo’s economic team to cover the deficit.”This will undermine the accumulation process when deposits of nearly US$2.750 million in commercial debt will no longer be available despite the appearance of liquidation of agricultural dollars.– Periphery warns.

In turn, when annualizing the dollars that will be poured into parallel markets, this gives a total of US$16,422 million, a figure that not only reflects 80% trade surplus project for 2024, but aligned with the levels of demand for external asset formation (FAE) of the economy in “normal” years of currency liberalization, as defined by the consulting firm.

For director of the consulting firm Pablo Moldovan, Under the previous administration, elimination of agriculture was considered. weak due to expectations of devaluation. At the same time, he recalls that during Massa’s time “the special exchange rate (the soy dollar) came to an end”, which still persists under the current economic management, but the Periphery finds three limits to the policy of intervention.

Government strategy to contain the dollar

In this sense, it is worth pointing out two arguments that may prevent the government from moving in this direction. Firstly, economic agents who are currently limited to purchasing foreign exchange in MUCL, They could start suing them this way.

Second, under the current design, the government “has the ability to reduce the amount of dollars it decides to allocate to parallel needs.” no impact on the official exchange ratewhich will not be verified if shares are opened,” the consultant warns.

On the other hand, we should not lose sight of the fact that the government is able to inject this amount of dollars into parallel markets in a year when “The normalization of harvests, the accumulation of new commercial debt and the recession allow this to happen.” For the Periphery, nothing guarantees that these circumstances will be repeated in 2025, ahead of an election year when portfolio dollarization typically increases.

Either way, in the short term, the amount of dollars the scheme requires raises doubts about its effectiveness. sustainability. “Maintaining it would mean reducing the amount of reserves the BCRA can accumulate and eliminating the possibility of exchange and monetary reform that the government is considering,” says Moldovan.

According to the expert, starting in September, this particular intervention scheme may become a problem for the government, even on the verge of complicating the issue of currency accumulation with the International Monetary Fund. On the other hand, note that the current model “It is very important to keep the gap under control to show that it will be possible to achieve currency competition without a crisis.“