MENDOZA, Special Envoy.- Before an audience eager to find clues about When will the Government decide to definitively lift banking restrictions?the vice president of the Central Bank Vladimir Werning reviewed the numbers of the current administration, asked for “patience” and assured: “We are not in love with the stocks. We are in love with our women, but we would have liked to have left the stocks yesterday.”
The official brought to the close of the first day of the 45th Annual Convention of the IAEF one of his usual “technical” presentations, in which he listed the measures carried out by the BCRA in coordination with the Ministry of Economy and stated: “The work that is being done to build the bases of a competition of currencies passesnot only because of external regulation and removing the restriction as if it were a band-aid. Rather, it has to do with a Kafkaesque tangle of domestic regulations that, if you don’t remove them afterwards, you don’t get the change you’re looking for in the economy.”
Werning reviewed the starting point and stated: “The Central Bank has a mandate, one knows the mandate of price stability, but it isThe mandate of financial system stability is one that often goes unnoticed.”
Along those lines, he focused on the clockwork that the Central Bank had to do to dismantle a financial system designed to lend to the State and another that aims to give credit to the productive sector. “It’s not something that happens overnight”he said and explained: “When there is a change in the economic regime as strong as the one we are experiencing, and the rules of the game are reconfigured, financial relations change, prices change, the interest rate changes… It is an extremely complicated context.”
The economist He stressed “prudence” with which the economic team works and said: “We believe that this change in the economic regime requires living up to responsibilities and ensuring financial stability. There are many layers of regulation that we are working on.”
At various points in his presentation, Werning stressed that “the foreign exchange market is the flip side of the domestic market. They are two sides of the same coin.” With an eye on the external front, the official assured that the ““fiscal anchor” is the one that allows for peace of mind regarding future debt maturities: “There is athe enormous liquidity of the system and the Treasury, “like never before. In the future, when debts come due, the Treasury will be able to buy dollars with genuine pesos.”
In that sense, he said: “It’s not until January, We have reservations, missing for July, We have the dollars, that is why we offer the dollars to the productive system“. In this way, he sought to settle the growing concerns in the market about the level of reserves and the decline in the “purchasing” capacity of the BCRA in the exchange market, just at a time of year that turns out to be seasonally negative and when the payment of imports has “normalized 100%.” “We feel comfortable, we don’t need to react nervously to what the markets say or want, but to the foundations of the roadmap that we have drawn up and from which we are not significantly deviated,” he stressed.
As for the domestic system, the economist welcomed the scenario of disinflation and recovery of activity. In addition, in line with what Luis Caputo had said this Thursdayhighlighted the recovery of credit to the private sector, at the same time he considered that the reference rates of the economy are once again positive for savers and investors.
“If we had lifted the restrictions immediately, how much would the rates have risen to?“We were building fiscal, exchange rate, and monetary credibility; we gave time to build credibility. The only way to sustain confidence was with positive rates; well, there they are, that is the virtue of patience that we ask of companies,” he said.