He dollar ended the year with a fall of 10.3% and so far in 2023 it remains ironed. In fact, until this Friday it never exceeded the $40 threshold. The exchange week ended at $39,496 and since January 2 it has accumulated a decrease of 1.43%. The depreciation of the US currency is worrying exporters and the sector is calling for changes in monetary policy. Some economists point out that there are aspects that could reverse this downward trend.
The president of the Exporters Union (UEU), Facundo Marquez, affirmed that no one can ignore that there is an exchange rate delay in Uruguay. “The Central Bank itself (BCU) says that the dollar is misaligned”, he indicated.
The depreciation of the currency was recognized by the president Luis Lacalle Pou days ago in an interview with the Argentine media La Nación +. “Today we have a problem with the dollar, we have to accept it. The dollar is very low, the Uruguayan currency has appreciated a lot, ”he acknowledged.
Márquez explained that the BCU has prioritized as an objective the inflation control, something that is shared by the exporting union. “For different reasons, inflation has been falling to historically reasonable levels. Now there are no more arguments, given the exchange rate delay, for not reversing the monetary policy that the BCU has been carrying out,” he said.
Diego Battiste
central bank
For Márquez in the short term there is a specific measure that must be taken: start lowering the interest rate. If that were to happen, “it is to be expected that there will be some movement in appreciation of the dollar, changing the trend a bit,” he said.
The CPA Ferrere economist Alfonso Capuro He thought along the same lines. The consultant’s estimate is that the Monetary Policy Committee (Copom), as of the meeting that will be held on Wednesday, April 19, the interest rate will be lowered. “That’s going to somewhat decompress the exchange market,” he said.
The PwC Economist Ramon Pampin He pointed out that the interest rate rise stopped (the Copom did not change it at its last meeting in February) and therefore it is possible that at some point in the year some reduction could be observed.
The monetary policy interest rate (TPM) is at 11.5%. In that last meeting, the Copom highlighted that inflation expectations began a convergence process. He explained that the average of the agents’ inflation expectation indicators for the monetary policy horizon had fallen for the second consecutive month, something that had not been observed since mid-2021.
In this scenario, Capurro’s forecast is that the interest rate could drop to 10.5% during the year and therefore the dollar would end up above $41 in 2023. “It represents a turning point compared to last year, but It’s not enough to put things back together competitiveness problems“, held.
Márquez indicated that the depreciation of the dollar is in the order of 12%. “That is what the BCU says in its monetary policy reports. That is the gap, ”he said.
In the latest survey of economic expectations from the BCU in February, those consulted placed the dollar at $42.
exports
The other aspect that would favor a rebound in the dollar comes from the side of the foreign sales. Uruguay reached a record of exports in 2022 with US$ 13,356 million. But for this year the perspective is different. A fact that will affect sales is the drought. “It is historic and it will reduce production. Not only the grains, but also the meat, because there will be fewer heads slaughtered,” said Márquez. “There is talk of US$ 2,000 million less production and that will be reflected in a lower dollar income”, he added.
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exports
Capurro explained that a year different from the record of 2022 is expected. The drought will cause exports to drop more than US$ 1,000 million, among which grains and meat. “If a lot of money came in last year, less will come in that year,” he mentioned.
Pampín agreed that “the supply of dollars from a commercial point of view (exports) will be less than in 2022. And if this was a factor of downward pressure on the dollar, it will no longer be in 2023.”
