The blue dollar has risen to ARS 343 and projections estimate that, far from stopping, it could reach ARS 400 or more in the remainder of 2022.
“Today we expect a blue dollar at 400 ARS at best by the end of the year,” said economist Natalia Motyl. So far, in the first 7 months of 2022 the blue dollar has risen by more than 64%, from 208 to 343 ARS.
"We are going through a crisis of confidence that has worsened in recent weeks after the political change," he said. Precisely in reference to the resignation of Economy Minister Martin Guzman at the beginning of July, which triggered the market turmoil.
At the same time, it indicates that this is framed in an adverse external context of rising interest rates by major international banks. This situation has a negative impact on emerging markets such as Argentina. Furthermore, the rapporteur states that an energy shock aggravates the accumulation of BCRA reserves.
"This causes a greater demand for foreign goods to protect themselves," he says. For this reason, in recent days in Argentina there has been an increase in the purchase of dollars and stable currencies with parity against the dollar, which has led to an increase in their price.
Argentines buy dollars or stablecoins to protect themselves from devaluation
The economics and cryptocurrency specialist says: "People are running away from the burden because today they don't perform one of its functions, that of store of value." In light of this, he warns that Argentines can protect themselves by buying dollars or USD Coin (quotation USDC). It is the second stablecoin with the largest market capitalization, after tether (USDT).
The document specifies that stablecoins can be traded at any time, without restrictions and, in some cases, at a higher price than blue ones. For this reason, it has become an option of choice for Argentines.
“Furthermore, some digital platforms offer profits on the accumulation of these cryptocurrencies. It's a great option to protect yourself from a devaluation, ”he says of investment products in the cryptocurrency ecosystem.
How can the rise of the blue dollar in Argentina be curbed?
Motyl also expressed its views on how to curb the rise of the blue dollar. From his point of view, he believes that the government, faced with a race against the peso, should apply a restrictive monetary policy (burn the pesos that nobody wants).
It also believes it should raise interest rates and reduce the fiscal deficit, which forces it to resort to injecting colored paper to finance it. By doing this, she believes she can try to stimulate demand for local assets and calm the markets so that the blue dollar stops rising.