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Informe Mensual Económico Financiero N° 340 – Junio de 2018



The combination of domestic factors (the persistence of high levels of inflation, the

fiscal and current account imbalance, the financial income tax, the political turmoil)

and external factors (arise in the US interest rate, exit of capital in the emerging

world, increase in the price of oil), created the favorable climate for the strong

exchange turbulence that had already been suggested in March and April and that

intensified in May with a total balance of dollar sale by the Central Bank for 10.2 billion

and a devaluation of 32.9% in the peso.

A particularly tense instance was the May LEBAC tender (Central Bank notes).

Although the Central Bank obtained a similar amount at maturity, there was a

significant decrease in the offers made by “non-banks” that was compensated by the

amount offered by banks, at a rate of 40% per annum. The Central Bank relaxed the

rules for the integration of reserve requirement, while the LELIQ (Central Bank

liquidity notes) stock from banks diminished substantially to free up funding. June 19


is the expiration date of another important amount of LEBAC.

The government began to negotiate an agreement with the IMF, in order to secure

resources for the payment of the 2019 maturities in case international markets Access

is blocked due to a worsening of emerging risk aversion, without detriment to

deepening the transfer of LEBAC to LETES (Treasury debt). Gross financing needs

2019 according to the IMF are around 9% of GDP, about two thirds of those in 2018.

Negotiations are advancing quickly, according to statements of members of the

argentine team and the IMF staff.

The IMF, in its review of article IV of the Argentine economy published at the end of

2017 raised a set of concerns and suggestions. Among the first, high inflation, high

fiscal deficit, external imbalance, low openness and rigidity of labor market

institutions. Among the suggestions: i) freezing of public employment; ii) improvement

of procurement practices and processes; iii) reform of the pension system; iv)

reduction of taxes on work; v) revision of labor standards; vi) reduction of import


El IAEF agradece la colaboración de la Sra. Marta Álvarez – Executive English en la traducción de

esta Síntesis Ejecutiva.