Informe de Evolución del Mercado de Cambios y Balance Cambiario

This report analyzes the evolution of purchases and sales of foreign currency in the foreign exchange market, corresponding to September.

Main aspects

The armed conflict between Russia and Ukraine caused great uncertainty and imbalances at the global level. Disruptions in input supply chains had a strong impact on international prices, mainly in energy products and food. As a result, there was an increase in global inflation and, consequently, an increase in reference interest rates in the world’s main economies.

In this context, the BCRA continued to improve foreign exchange regulation in order to promote a more efficient allocation of foreign currency. In particular, in order to encourage the commercialization of soybeans and their derivatives, the National Government established through Decree 576/2022 of September 5 the “Export Increase Program”, through which an exchange rate of $200 for every USD 1 was established until September 30 for exports of these products (to access Decree 576/2022 click here).

In September, the clients of the entities sold USD 5,511 million in the foreign exchange market, of which USD 5,062 million were purchased by the BCRA (USD 7,647 million were purchased within the framework of the Export Increase Program and USD 2,585 million were sold for the rest of the concepts) and USD 523 million by the entities. at the same time, the BCRA made net payments through the Local Currency Payment System for USD 74 million. In addition, the BCRA made direct sales to the National Treasury for USD 964 million.

The “Real Sector” was a net seller of foreign currency for USD 5,448 million in the foreign exchange market. Within this group, the main sector in terms of net sales, “Oilseeds and cereals”, recorded net revenues of USD 8,128 million, 230% more than in the same month of 2021, driven by the “Export Increase Program” established by the National Government.

The “Real sector excluding Oilseeds and cereals” was a net buyer for a total of USD 1,886 million in the market, exhibiting a year-on-year reduction in its purchases of 28%. The purchases were mainly intended to make net payments for imports of goods and services and to pay off financial debt.

The “Individuals” bought USD 625 million net, basically to meet expenses made with cards for consumption with non-resident suppliers and for treasury, for USD 391 million and USD 191 million, respectively.

The “Institutional investors and others” sector, both resident and non-resident, made net purchases in the month for USD 169 million.

The foreign exchange current account, which includes net flows from net exports of goods and services and primary and secondary income, registered a surplus of USD 5,478 million. This result was explained by net income from transfers for goods of USD 6,948 million, partially offset by the deficit results of the “Services”, “Primary income” and “Secondary income” accounts of USD 1,075 million, USD 387 million and USD 9 million, respectively.

The foreign exchange financial account of the “Non-financial private sector” had a deficit of USD 560 million in the month. The records for the cancellations of balances in foreign currency with local entities for the use of cards with non-resident suppliers for USD 379 million (which do not entail a net demand for foreign currency), the cancellation of foreign loans, debt securities and local loans for USD 58 million and the formation of foreign assets for USD 102 million stood out.

In September, the operations of the foreign exchange financial account of the “Financial Sector” were in deficit by USD 616 million. This result is mainly explained by the increase in the liquid foreign assets of the entities that make up the General Exchange Position (PGC), partially offset by net income from financial loans and credit lines of USD 93 million.

On the other hand, the operations of the foreign exchange financial account of the General Government and the BCRA resulted in a deficit of USD 2,509 million, mainly explained by the cancellation of capital with the International Monetary Fund (IMF) for the equivalent of USD 2,602 million (2,014 million SDRs).

In September, the BCRA’s international reserves increased by USD 891 million, ending the month at a level of USD 37,625 million. This increase was mainly explained by the BCRA’s purchases in the foreign exchange market, partially offset by gross capital payments to the International Monetary Fund for the equivalent of USD 2,602 million (SDR 2,014 million), the fall in the price in US dollars of the assets that make up the reserves by USD 792 million, the reduction of deposits of entities in the BCRA by about USD 500 million and net payments through the Local Currency Payment System by USD 74 million.