In order to capture more cash from the financial system, the Central Bank yesterday launched the LEBAC and NOBAC notes, which had a high impact snapping up around nine billion pesos once the peso- and dollar-denominated notes are added up.
Interest rates for 70 and 98 days notes in pesos reached 25.5 percent and 25.89 percent, six percentage points more than the usual rates, as part of the Central Bank’s efforts to get cash out of circulation and present attractive options for those who choose to invest in pesos and dollars.
While 5.1 billion pesos were collected with the pesos note, US$19 million were collected with the dollar note.
The Central Bank launched the LEBAC note in dollars for new fixed-income deposits as part of its effort to vacuum up excess dollars that will be in the market following the renewal of a scheme to allow dollars for savings. The monetary authority yesterday issued six, 12 and 24-month notes on rates that are between one and four percent.
On Friday, the Central Bank announced an increase of six points in the notes with which it absorbs the pesos that are circulating in the market. Analysts expect this means that banks will increase the interest rates on fixed-rate deposits by around two additional points above the 23 percent they are currently paying.
The official dollar remained largely stable yesterday, rising half a cent and closing at 8.015 pesos, maintaining a stable level due to the intervention of the Central Bank, which sold US$60 million in the market. On the other hand, the “blue,” or black-market dollar rose 35 cents (2.87 percent) yesterday and closed at 12.50 pesos, widening the gap with the official dollar to 56.48 percent.
Due to its intervention in the market, the Central Bank’s international reserves dropped US$188 million yesterday and closed at US$28.701 billion. On Monday, a drop of US$174 million was registered, breaking the US$29 billion barrier.
So far this week 22,097 transactions to purchase dollars have been approved, which represent US$12.78 million. The AFIP tax bureau has authorized a total of 184,338 transactions for US$90.168 million, which leads to US$77.386 remaining to be exchanged at banks.
“The growth of the ‘blue’ dollar can be explained since the restrictions still continue. Not everybody can buy dollars, companies are not included in the new scheme,” a broker told DyN news agency yesterday.
The Merval benchmark stock index rose yesterday 0.99 percent and closed at 5,600 points, negotiating 86 million pesos in stocks. Growths were registered in Telecom (5.49 percent), Petrobras Argentina (4.65 percent), Banco Francés (3.45 percent), Edenor (3.11 percent) and Indupa (2.55 percent), while the main drops were on Banco Macro (2.48 percent), Grupo Financiero Galicia (1.59 percent) and Siderar (0.88 percent).
In the futures market, the dollar was negotiated for August contracts at a 9.4 pesos rate, leaving the door open for a higher devaluation to come.
Source: Buenos Aires Herald