Argentina's financial landscape is witnessing a notable surge in the blue dollar and financial dollar values, attributed to a year-end trend of portfolio dolarization. The blue dollar rose by 40 pesos, or 3.4%, reaching 1,205 pesos for sale, marking its highest point since October 28. This month alone, the blue dollar has gained 85 pesos, or 7.6%.
Contributing factors include seasonal demand for dollars for tourism, as well as the appreciation of the dollar against regional currencies, particularly the Brazilian real, which has depreciated by 25% against the dollar this year.
In the official exchange market, the dollar increased by one peso to 1,022.50 pesos, resulting in a gap of 17.8% compared to the blue dollar. Meanwhile, the dollar traded through bonds and stocks also saw upward movement, with the dollar counted with liquidation surpassing 1,180 pesos.
The Central Bank of Argentina (BCRA) intervened in the market, closing with the CCL at 1,162.40 pesos, up 1.4%. In a wholesale trading session, the BCRA absorbed 32 million dollars, maintaining a positive balance for December.
International reserves slightly decreased to 32.253 billion dollars, following a peak earlier in the week. Analysts noted a trend of bank deposit withdrawals and year-end bonuses contributing to increased dollar coverage.
Global strengthening of the dollar followed a press conference from Federal Reserve Chair Jerome Powell, who indicated a slowdown in interest rate reductions. This led to declines in U.S. stock indices and a significant drop in Brazilian stocks.
Public debt bonds, however, gained traction, with the country risk index dropping to 658 basis points, the lowest since November 2018. President Javier Milei expressed confidence in eliminating currency controls by 2025 and securing new agreements with the IMF.
The recent dollar increase has raised concerns about potential devaluation in early 2025, as speculation grows regarding the government's capacity to manage the rising dollar amidst dwindling international reserves.