Although macro imbalances remain, the Minister of Economy, Luis Caputotook advantage of the drop in inflation in May to move to a new stage of positive real rate of bills in pesoswhile continues to maintain, for now, a negative real rate for fixed-term deposits.
“The era of the negative real rate ended today for us”Caputo stated last Wednesday when speaking at the EFI Expo. Thus, he referred to the Lecap tender expiring in September of this year, with awards for a total of 5.4 billion pesos. “We have done a tender where we set a minimum rate of 4.25 for 90 days. Although there were offers at 30 and 60 days at a lower rate, we ended up taking the entire 90-day tender at the rate of 4.25 to give the signal to the market that the function of the negative real rate of the first months had already been fulfilled. its objective,” explained the minister.
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That is, the government of Javier Milei thus sought to show a kind of gesture to the markets, by ruling out the possibility of taking the offers at a lower rate than what he finally did.. In that sense, Economía reported that “it was resolved to leave void the Lecap maturing on July 12, 2024 and August 16, 2024”, which had a lower rate. For now, it is a gesture and not much more, with a barely positive rate this month compared to the 4.2% inflation rate in May which revealed the Indec this Thursday.
The situation becomes even more complex because Private analysts predict that inflation will stop falling starting in June. Latest Survey of Market Expectations (REM)prepared by central bank Based on the forecasts of consulting firms and banks, it is estimated that inflation this month will be 5.5% and that it will reach a minimum of 4.5% only in November.
But Caputo rejected these forecasts by stating, last Sunday in a television interview, that the same economists did not expect the price rise to slow down so quickly during the first half of the year.
The performance of fixed terms in June
Thus, The Treasury Palace, together with the Central Bank, seems to be entering into a scheme of positive bond yieldswhich will favor large investors, in parallel to one of negative returns for monthly fixed depositswhich will continue to harm the savings capacity of small savers.
During May, the BCRA lowered the monetary policy rate twice, one week apart, to take it from 60 to 40% of the annual nominal rate. So, the yield on fixed terms in most commercial banks became between 3.08 and 4.17% monthly, so they remain in negative territory. The same happens with the annual effective rate, which is around 34% (for example, in Banco Nación), in the face of annualized inflation that, at the May value, would run comfortably above 50%.
Until now, The Central Bank did not report any rate movements this Thursday, usual day for this type of communications as it is the day of your board meeting. But it seems unlikely that they will decide on a rebound to set an upward rate compared to the inflationary decline of the last month. In any case, it would be more logical that, given this scenario, the authorities of the monetary entity simply decide not to continue lowering it.
Joel Lupierifinancial analyst at the consulting firm EPyCApointed out that The interest rate of bonds and that of fixed terms “should be coupled” if “the Government is responsible for its ideology”, but warned that “there is no certainty that this will happen immediately, but that it could take some time until these particularities are refined.”
