What are the reasons for the growth of the dollar according to Javier Miley

Awakening free quotes dollar What was observed last week alarmed some market analysts, who offered explanations for the reasons for the increase. The president Javier Miley This Thursday he mentioned the currency and the fundamental factors that will underlie its movements.

In particular, for Miles there is a delay in approval Draft Basic Law What does he do during these hours? Senate This sent a bad signal to the markets.

“There was a whole euphoria about the possibility of Ley Base coming out. The stagnation that is creating in the Senate had another side: bond prices fell and country risk increased. The exchange rate we once had requires a higher interest rate, why? Because the risk was accepted,” the president said in an interview with La Nación+.

“The market was waiting for major legislation to be approved and was on track to overcome a thousand basis points of country risk. Politics gets its tail, starts boasting about fiscal degeneration, and here it is. In any case, it doesn’t bother us. We are not going to abandon the budget balance. We died with our shoes on,” Miley explained.

On the other hand, he argued that what is observed today in parallel dollars “It wasn’t running.”. “If there was a bullfight, central bank He would have to sell dollars, and he buys a lot of dollars every day, so he doesn’t qualify. In addition, this is a rather hysterical situation, because before there was a problem of delay in exchange, now there is a problem of mileage,” he said.

According to the president, analysts who point to the recent reduction in BCRA interest rates are wrong: “There is a relationship between the interest rate and the exchange rate: when you raise the interest rate, the exchange rate falls. So you might say you’re crazy because the rates were going down and now the exchange rate has jumped and people are moving to the dollar and that could be an indicator. From my point of view, this is wrong.”

“In fact, all the movement that we make on remunerative obligations in favor of the Treasury has very important properties in monetary terms, because it reduces future inflation, therefore reduces pressure on the price level, and the dollar is another price,” explained Miley.

He Dollar blue” This Friday, the 15th, the company reduced selling prices to $1,265, breaking a series of five consecutive increases. The unofficial currency maintained gains of 150 pesos, or 13.4%, last week and hit an intraday nominal record of $1,300 on Thursday the 23rd.

Favorite bonds such as AL30 reached US$60 in late April, but declines in recent days have brought levels close to US$55. Something similar has happened with other longer bonds, but they are trading at levels below US$50.

Exporters were not present, and enterprises in Free Exchange Market (MLC) They amounted to only $257 million, of which $59 million was purchased by the Central Bank. However, its reserves increased by US$80 million to US$29,008 million.

The question today is whether the dollar has hit a ceiling, a key piece of information for investors who are speculating on a hidden rate rise through LEKAP which could return to yields above 4%. In that Ministry of Economics They have no doubt that there are reasons why the dollar will not rise, since agriculture has delayed most of its harvest and is waiting for higher prices for agricultural products. Chicago. Contribution of sector dollars to the market KKL This is the key to preventing currency appreciation and stimulating inflation.