IPROFESIONAL – The Argentine who can save some pesos and wants to put them for a fixed period wonders if it is still a good alternative to turn over in August.
Above all, due to the domestic economic crisis, boosted to the maximum exponent by the pandemic, which opens new problems and lags that focus on a possible acceleration of both inflation and the price of the dollar.
Of course, all the aforementioned happens in a framework where the dollar becomes a safeguard but difficult to access, due to an exchange stock that does not allow buying more than $ 200 a month in the official market.
And, on the other hand, the blue climbed to $ 140 days ago, widening the exchange gap to more than 40% with the solidarity dollar (which is the retailer plus 30% Country tax), a fact that puts pressure on the reference price of the exchange rate and that can be transferred to prices.
Despite these threats and difficulties, so far, an equation has been given throughout the year that closes the saver who turned to a fixed term in pesos, since he beat the general rise in prices.
In figures: with an annual interest rate of 30.02% (or 2.5% monthly) for loans of less than $ 100,000, offered by almost all banks to their users, this savings instrument has won in recent years months to inflation, which for example in June was 2.2%. Percentage that would be similar in all of July.
Although when compared to the performance of the fixed terms with the devaluation of the currency, they remained below this level. In fact, so far in July, the exchange rate rises 3.1% in the official retail position and the implicit price of the dollar that is achieved in the Stock Market with the purchase and sale of stocks or bonds (Counted with settlement (CCL) and MEP), climbs up to 13% only in the month.
In summary, the radiograph shows that, today, the fixed terms beat inflation but lose against the movement of the dollar.
“Let us remember that inflation comes at a ‘low’ level helped by price controls, frozen rates and very depressed economic activity,” warns iProfesional Mariela Díaz Romero, Senior Economist at the consulting firm Econviews.
In the following graph, it is verified that this happens punctually with the different variables in the last four months, since the quarantine began due to the covid-19 pandemic. The performance of the fixed terms during the quarantine was above inflation. of the fixed terms during the quarantine was above inflation
Fixed terms: should we put money in August?
Although it is true that in the first part of the year the fixed terms beat inflation, the economists consulted by iProfesional raised a blanket of doubts that this beneficial situation will continue in the coming months.
And by August, on time, everything will depend on what happens with the various variables, such as the evolution of the recent overheating of the value of the blue dollar. Something that can put pressure on the exchange rate and accelerate, at the same time, the rise in prices of some products.
In the short term, the economists consulted by iProfesional affirm that an acceleration of inflation will begin to be noticed, and what must be kept in mind is that the interest rates of the fixed terms accompany this rhythm to remain positive and, logically, attractive.
“We expect inflation during the second half to be, on average, somewhat higher than 3.5% per month, and so if the interest rate paid to savers does not rise, it will lag behind inflation and the exchange rate too ”, summarizes Díaz Romero.
And she adds: “We hope that the exchange rate will accelerate, which will cause the inflation rate to also do so (due to the transfer effect), but to a lesser extent.”
Meanwhile, according to Elizabeth Bacigalupo, ABECEB economist, if you look at the REM of the Central Bank, a report where the monetary entity surveys several economists, inflation is expected to be 3% in August. “We project it to be 2.8%. I don’t think the ammeter moves too much, but it’s subject to what happens with the blue”, he says.
For Iván Cachanosky, economist at the Fundación Libertad y Progreso, inflation may also rise to 3.5% in August.
“There is a key factor that will help inflation to accelerate and that is that, as it returns to normal and activities start working again, the pesos that were stored as a precaution will no longer be demanded and this can put pressure on it at the parallel exchange rate”, alerts this analyst.
In the event of a noticeable increase in prices, it is estimated that the Government will react to avoid causing an imbalance and will maintain positive rates for savers.
“Containing inflation may have something else a priority on the post-pandemic government’s agenda, and this could mean an increase in interest rates sometime in the second half of the year, “adds Cachanosky.
In addition, an important issue to clarify is that in recent months inflation forecasts have always been higher than what specifically ended up being their final numbers.
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An example of this is that in April the effective fixed-term rate was 1.8% and inflation was 1.5%, although 2.5% was expected according to the REM survey of the Central Bank.
In fact, the fixed-term rate beat the price hike each month. Something that can happen again in August.
“If you look at the comparison between the effective monthly fixed-term rate from April to June, it has always beat effective inflation,” Bacigalupo highlights.
And for August, he considers that “the scenario is not going to change too much, unless there is a shock like there is no agreement with the debt, or that the blue explodes and that is why people are scared and take their deposits, or that another happens something that frightens the Argentines.
”The inflation of the second semester may be higher, and that would undermine the income of the fixed terms if its interest rate is not accommodated. The inflation of the second semester may be higher, and that would attack the fixed-term income if your interest rate is not adjusted
How much does a fixed term yield today?
A topic that is important is the yield offered by a fixed term (2.5% monthly), which is a level very close to inflation (in June it was 2.2%). If the case is taken that a 30-day placement of $ 100,000 is made, the yield obtained will be $ 2,500.
An income that is not as attractive because of the capital allocated, but neither does the saver have any other “escape” to maintain the purchasing power of their savings. In particular, this happens to companies that cannot resort to the blue dollar, because it is an illegal operation and cannot be justified before the AFIP. So they have no other option than bank loans.
“I think there will be no significant change in behavior and there will continue to be an increase in time deposits, which have been growing strongly in recent months. In May the total stock of this type rose 8% in the month against April, in June it increased 11.9% and in July it was 5.6% higher ”, summarizes Bacigalupo.
“The impossibility of buying dollars will continue to exist, it may even be deepened. But when not having a hedge against a strong currency, such as the dollar, the closest substitute there is to buy goods or something tied to inflation, which is what will end up winning, “says Guido Lorenzo, Chief Economist of the consultancy LCG.
And he adds: “In general, there are many captive companies with fixed terms, not so many individuals. I do not see that for now these placements are so attractive, but these funds are captive to this option. The truth is that a positive real return is needed. ”
In this sense, Lorenzo concludes: “For the very short term, the fixed term can continue to be positive because we do not see a significant acceleration in inflation. There are not many places to go, but it is not so attractive now. ”It may interest you
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It is that if inflation rises more and the fixed terms do not offer too much appeal, the saver is expected to look more “fondly” at the blue dollar, something that can overheat its price due to the greater demand and the lack of dollars in the market.
That is why the Government, as a tool to avoid a lag in the economy, probably does not want to leave behind the yields of the fixed terms with respect to the rest of the variables.