Fear of floating
The beginning of the new year brought few surprises. The BCRA began to make daily purchases of reserves as announced; it also canceled the tranche of the swap with the U.S. Treasury disbursed in October and placed a one-year repo with international banks, the proceeds of which were sold in part to the National Treasury so that the latter could cancel debt with bondholders coming due in January. The most recent economic indicators show that the economy is far from strong. Both inflation and activity appear to be stagnant. If the government feels the need to introduce changes in economic policy to improve the situation, it is making a good effort to disguise it. Financially, the pax pecuniaria resulting from the favorable October election result still stands, although it has begun to loosen. It is not clear whether the apathy of the government in addressing these problems is the result of the summer recess or the authorities' conviction that nothing is broken enough to try to fix it. It remains to be seen if major policy changes will be introduced when talks with the IMF resume and the program's goals are redefined in February.
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