The blue dollar consolidates the rise: what value can it reach at the end of the year and how will the financiers continue?

The blue dollar consolidates its upward trend and closed this Wednesday, November 23, at $312, with which it climbed $4 and reached its highest value since the financial crisis of July. In turn, the financial dollars that are traded on the stock market-counted with liquidation and MEP-showed fluctuations during the session but ended in decline. The CCL was at 325.70, and the MEP (Electronic Payment Market) was at $311.98.

After three months of stability, all parallel dollars jumped the week driven by a mix of factors. Among them, that they were far behind in real terms and the uncertainty generated in the market by the debt in pesos, which shows signs of saturation, given the weak results of the latest Treasury tenders.

On the causes that prompted free dollars, the economist Lorenzo Sigaut Gravinafrom Equilibra, stated that “several negative news are added: the BCRA selling currencies, the impact of the drought so that the wheat harvest is going to be bad, and there will be fewer dollars in the summer, The world is complicated, interest rates continue to rise, which always affects emerging countries”.

Given this scenario, analysts expect the blue to continue climbing due to the demand of those who travel to the World Cup in Qatar and the holidays that are approaching. Thus, they envision it by the end of the year at a value of around $330.

For financial dollars, they also project an upward trend and the value they reach will depend, to a large extent, on what happens with the reserves and the roll over of the debt in pesos.

Blue dollar: the highest value since July

The Economist Frederick Glustein indicated that the value of $312 of the blue is the highest “since July 27, although it is still far from the $337 of July 21”, in the midst of the financial crisis after the resignation earlier that month of former Economy Minister Martín Guzman.

The blue dollar warmed up and closed at $312, the highest value since July 27

About the new jump of the blue, Glustein pointed out that “there are several factors, but mainly there is an increase in demand for savings and tourism near the end of the year” and considered that “this reaction is foreseeable because compared to the financial dollars it was lagging behind.”

The financial analyst christian buteler agreed that the magnitude of the blue “is within the normal movement” and added: “It is time that we start to see it in terms of percentage, because $4 is not the same when it was at $100 than when it is at $300”.

“Last week it took a leap, then it froze a bit and, now, it gained strength again, but it is in accordance with what is expected. The rises are never linear, it is having saws, but with a clear upward trend,” he commented.

And he attributed the increase in blue “on the one hand, to the demand of those who are traveling to the World Cup in Qatar and, on the other hand, to a question of arbitration, because the MEP dollar and the CCL are also high, and the informal was perceived as cheap”.

Buteler predicted that “of the three alternative dollars, the blue is going to be the one that grows the most because it is the most backward and there will be a greater demand because the holidays are coming. People are going to go informal because they are not going to pay the dollar card that at that moment can be at $350, when they can pay the blue at $312″.

And it is that the analyst explained that there is no incentive to use the dollar card because “what you spend in January with your card you will only recover the following year.”

In the market they attribute the rise in blue to the demand of those who travel to the World Cup in Qatar

In the market they attribute the rise in blue to the demand of those who travel to the World Cup in Qatar

Blue dollar: what value do you see at the end of the year?

Glustein pointed out that “the measures promoted to add dollars are not having the desired effect. It was expected that they could accumulate foreign currency or reduce the impact of the increase in imports with the SIRA, but in November the BCRA sold more than US$900 million and it is coming an intense summer in that sense”.

In this context, the economist foresees that “this reaction (of the blue) will be sustained in the short term but with jumps between days, without these being continuous, and above all depending on the demands of the other sectors, derived from the tenders of debt that are not successful or derivation of instruments in pesos to the dollar”.

“Surely, will scale minimum up to $330 but it could be greater come December with the collection of bonuses and/or Christmas bonuses, in addition to outbound tourism,” Glustein predicted, adding that “there are outlets that sell less or stop selling due to the fall in cryptos; Then, the supply is reduced and with active demand, it tends to rise.”

For Butler, the price of blue towards the end of the year will be in a range of “between $330 and $350“, and predicts that “at some point the informal dollar will be above the card dollar price again.

“It is logical that the dollar that is totally free, that has no limit, generally has always been the most expensive. It may, momentarily be below the others, it has passed, but if I look at all the time in which we have had stocks, the 80% or 90%, the highest dollar was the one that did not have any kind of restriction,” he stated.

Financial dollars: will they remain stable or continue to rise?

After the abrupt jump that they showed last week, financial dollars in the last two days closed lower. An operator counted “There was intervention on the closure to lower them”. In the market they show that during the conference this Wednesday the CCL and the MEP tended to rise, but in the final stretch there was official intervention -through organizations that sell bonds- so that they end with a downward trend.

Due to the greater issuance of pesos for the purchase of BCRA debt, the market foresees an upward trend for financial dollars

Due to the greater issuance of pesos for the purchase of BCRA debt, the market foresees an upward trend for financial dollars

The analysts of Delphos Investment they raised that “it is hasty to speculate with a stabilization of the financial exchange rate” and they remarked that “the BCRA continues issuing to defend the (debt) curve in pesos. These surpluses tend to seek refuge in hard currency.”

Of the same diagnosis, in Adcap Financial Group They pointed out that “the monetary authority is strongly intervening in the secondary market, especially buying 2024 bonds.”

The intervention by the BCRA in the secondary market generates more pesos on the street and fewer dollars, so the underlying risk in the short term is that the CCL continues to rise,” they warned.

In addition, Adcap analysts stated that “anything that happens in Brazil can quickly end up having an impact on the CCL. For this reason, we must closely follow what is happening in our neighboring country and main trading partner: there the real rose a lot, and seeing the CCL adjusted for inflation, it could easily rise 7% more and reach $360- $365″.

For his part, Pablo Repetto, Head of Research at Aurum Valores stressed that “financial dollars are only now adjusting to the excess pesos that were seen in the economy.”

“As the number of pesos in circulation will continue to grow, it is likely that the course will be in an upward direction,” he argued.

The evolution of reserves will be a determining factor for the progress of financial dollars

The evolution of reserves will be a determining factor for the progress of financial dollars

for the analyst Gustavo Ber“the upward readjustment of financial dollars will continue due to the closure of the carry trade bets, and concerns about the ‘many pesos-few dollars’ dynamic will continue to put pressure on the background together with an early electoral scenario that usually activates greater dollarization” .

In turn, the consultant GCL He maintained that “the BCRA’s liabilities worsen” and “to this is added the low position of international reserves, having already lost 20% of what was collected by the soybean dollar.”

“The net reserves barely reach 0.4% of GDP and if gold is subtracted they are already back in negative territory. The CCL reflects this deterioration and pursues the convertibility ratio between short-term liabilities and assets: the convertibility exchange rate is at $356 and the free dollar begins to approach that value again. This trend will intensify to the extent that the BCRA cannot rebuild its assets,” he highlighted.

Financial dollars: what value could they reach?

In PPI calculate that, based on the pesos that are in circulation, “the CCL could escalate up to the theoretical value of about $363″and indicated that “although in nominal terms the peak of $338 would be exceeded -of last July in the middle of the exchange crisis-, this maximum is equivalent to $432.2 from today”.

At the same time, Salvador Vitelli, A specialist in finance and agribusiness, he also foresees that the financial dollars “will rise a little more, the Mep in the range of $325-$330, and stabilize at those values ​​unless there is a driver that makes the market overheat again, as were the rumors. of Gabriel Rubinstein’s resignation, there may be other unexpected things and there may be some extra rally”.

“But they could be calming down around $325-$330 according to the ratios that I analyze, it is an equilibrium value,” the economist said. However, Vitelli maintained that “What the market looks at is the debt in pesos, a mountain of pesos that are being issued, and the rates that are yielding”.

Uncertainty over debt in pesos is another factor that pushes financial dollars upwards

Uncertainty over debt in pesos is another factor that pushes financial dollars upwards

Also, the consultant fmya asserted that “the scenario of lower reserves and more issuance of pesos woke up the parallel dollar” and he maintained that after the last tender of the Treasury, “concerns about the debt do not stop and since the BCRA issues pesos to support prices, it puts pressure on the dollar.”

“The trend of the dollar is bullish,” predicted the consultancy and projected three possible scenarios for the medium term: “If it manages to control the debt in pesos, it sounds logical that it go to levels of $360, as suggested by the convertibility dollar; if it fails to stabilize the debt in the coming weeks and continues to lose international reserves, it seems logical that the dollar will go to the levels of $430 during the departure of Guzmán”.

But warned that “If the scenario is pessimistic and Massa were to resign, it sounds credible (a parallel dollar) of $500similar to from the end of the Covid crisis in October 2020 (they were $200, but adjusted for inflation today they are $500)”.

“Of the 3 values, most likely today is $360because we assume that Massa still has tools to stabilize the pesos and dollars,” he emphasized.

buteler He predicted that “I see the CCL quietly reaching the range of between $350 and $360 by the end of the year.” And he clarified that this forecast “is in an optimistic scenario, where inflation does not skyrocket anymore, nor do you have an event that alters you.”

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