He central bank eliminated a regulation that made financial investment in dollars difficult, thus marking new progress in the gradual dismantling of the exchange rate with the aim of improving competition between currencies.
The monetary authority has provided that people will no longer be required to transfer dollars obtained from income or amortization to their bank accounts before reinvesting them. Now, they can do it directly within 15 business days.
This measure, established through Communication “A” 8042, will come into force as of July 1. It is important to note that the standard does not cover dividends obtained from such investments.
However, market operators consider that this measure is insufficient to significantly improve the functioning of the market, and They demand the repeal of Communication 7340, which imposes much stricter restrictions on this type of operations.such as the obligation to send MEP dollars traded on the stock market to a bank account and then send them again to the client account.
From the banking entity they maintain that they will advance in more releases of this type of controls “as long as these measures do not imply excessive risks for the process of reducing inflation and strengthening its balance sheet.”
“The process will be defined by the Argentine authorities themselves, contemplating the evolution of the relevant economic variables, who will share with the IMF the parameters that will be monitored, without including commitments of dates or specific measures”specified the BCRA.
At the same time, it was highlighted that the approval of the 8th review of the Extended Facilities Program in force with Argentina releases the disbursement of 600 million Special Drawing Rights (SDR), equivalent to around US$ 790 millionan amount that exceeds the next amortization to the IMF (July 2024) of approximately US$ 645 million.
The payment scheduled for July is the last amortization payment to the IMF contemplated within the framework of the current program that expires in November 2024.
As of that payment, and for the next two years (until September 2026), Argentina does not face any more principal repayment maturities with the IMF.
“The decision of the IMF Board of Directors occurs in a context in which the economic policy actions implemented by the current administration resulted in overcompliance with the quantitative goals established in the 7th review of the Program (accumulation of net International Reserves of the BCRA, balance fiscal of the Public Sector, and monetary financing of the Treasury)”clarified the organization.
