Argentina’s Official Dollar Drops Below 1,400 as BCRA Signals Cautious Reserve Strategy

Overview

• The wholesale rate fell for a fifth straight session to ARS 1,387, slipping under ARS 1,400 and sitting about 8.5% below the ARS 1,504 band ceiling.
• BCRA chief Santiago Bausili said reactivating the U.S. swap is unnecessary, flagged that IMF reserve targets will need renegotiation, and indicated purchases will resume only once money demand recovers.
• Fresh private FX supply helped cap the rate, with November corporate bond liquidations around USD 3.15 billion and roughly USD 2.9 billion in local ON placements, alongside expected provincial issuance.
• Parallel rates stayed above the official level, with the blue near ARS 1,435, CCL around ARS 1,486 with a roughly 7% gap, and MEP near ARS 1,446 with a gap near 4%.
• Risk assets weakened as ADRs fell up to 6.1%, the S&P Merval in dollars slipped below 2,000 points, and Global bonds edged lower, even as Economy reported an October primary surplus of ARS 823,925 million and a year-to-date primary balance near 1.4% of GDP.