The Dollar

What can happen beyond the 28 of June? As I mentioned previously, for the government an upper limit exists for the type of change located in $ 4, beyond which it would not turn out advisable to take to him to the quote of the dollar. If the dollar continued with its ascending dynamics and quoted very towards year end over $ 4, it could generate consequences highly desestabilizantes for the Argentine economy, surpassing widely the potential benefits that exchange depreciation would imply for the country. Beyond accelerating the demand of dollars and to limit its supply, it would increase the risk inflationary returning to reactivate its dynamics with the danger that it is accelerated by own force. On the other hand, the financial system is suffering at the moment exchange dynamics. The banks have had to resort raises to it of passive rates (rates of pick up of bottoms) to avoid the flight of deposits. to continue with force exchange depreciation, to the banking sector it will be more and more difficult to maintain the deposits to him in the system, which will repel in addition in the capacity to the same to generate credit for the consumption and the investment. Beyond which already several analysts cheer up to anticipate that the dollar will surpass the ceiling of $ 4, it would not represent a good business for the government, who will have in it an opportunity to take something of certainty to markets, at least in the exchange aspect. Thus, while Argentina waits for a hand of the international context via the recovery in the price of its commodities (something with very little probability of occurrence in this year), it will have against himself that to free one hard fight in the exchange market to avoid that from the same destabilizing factors of the economy arise. Again, the Argentine government will have to solve tensions brought about by his own economic policy He will manage to learn the lesson? Original author and source of the article.