Former president of the Central Bank Aldo Pignanelli said the federal government “woke up the beast” as he analyzed the recent surge in the so called “blue” dollar.
“The hike in the blue worries because when the dollar moves, prices move (even though) there is no direct relation between the increase in prices and the dollar,” Pignanelli said today in statements to the Radio 10 station. “It creates uncertainty,” he added warning the government had bet for a smoother exit in December but “due to mistakes, they woke up the beast.”
“The blue dollar is a guide for those who want to save or cancel an import because they have the access to the official (dollar) restricted,” the expert working for Renewal Front (FR) presidential hopeful Sergio Massa said. “Whenever there are elections, there is always a sector of society seeking to protect itself.”
Still, the economist considered “there are several issues” taking the parallel dollar up, adding the US currency was “strengthening at a global level.” “Almost all countries are devaluating,” Pignanelli pointed out. “I am not alarmist about what can happen with the dollar in the upcoming days, the government will do something.”
Regarding the current restrictions in the purchase of foreign currency, the ex-official explained that his team has been working on a “plan of 100 days to lift” them. “A country with the economy as that of Argentina’s cannot have a foreign currency clamp for so long,” he said and questioned a primary surplus report that was released today. “False,” he answered when queried about the economic data.
“If we take out the extra income (of the Central Bank and the ANSES social security office) the primary deficit is huge.”
In another part of the interview, Pignanelli referred to Argentina’s current legal battle against so called “vulture funds.”
“We are in an electoral stage and everybody talks about that; not talking about it (the dispute) does not mean it has been resolved.”
“We have no access to transparent credit, we had to turn to China which is not that all clear,” he stated and pointed out “in Argentina the capital cost is very high, and that changes the investment decision.”
“We have to wait for the change of government, for a new stage to begin,” he finally said as the presidential primaries near.
“Courage is needed to take decisions, some things work others don’t. The adjustment has already been done by the government, because poverty is at 30 percent, because it (Argentina) is the second country in the world in inflation terms, it has no access to credit,” he warned.
“We cannot demand the current government when it is months from leaving, it has to get to the elections the best it can.”
Source: Buenos Aires Herald