After decision to devalue the currency January 8, the government took on the task of trying to diminish the negative effect of devaluation, announcing price controls, minimum wage increase and the supply of bond auctions by the Central Bank to intervene in the so-called "market parallel "currency.
Moreover the president has redefined the economic term indicating that the measure was a revaluation of the bolivar, which simply seeks to try to minimize the drastic effect that involves the measurement itself.
Perhaps most interesting of all is the international perception that has been positive so far and even has given the nation an improvement in their rating risk, which has made the debt more attractive in international markets generating increases of more than 15 percent in the prices of some of the titles.
International investors see the positive side, less need to issue debt to fund domestic needs in Bs and an adjustment to the imbalance of the foreign exchange market. It seems that so far fulfilled its purpose.
To complement all the government announces auction of securities that are actually more deals as the price is fixed, ie there is the famous bid that is traditionally in this type event, which is logical as the government does not want the dollar alternative to fire and to the strong demand for the currency and the low supply, it is more likely that the price to skyrocket.
In any case, these auctions will provide some respite to the market, because although the dollars are not received immediately, there is the possibility of obtaining them. The problem here is that this scheme may not lower the price of the dollar, and nobody will leave their dollars today at a price less than 5.8 for having to wait three months to receive a 5.
This situation might improve, as the state use other titles such as PDVSA bought back bonds that are traded today much better than the past and could further stimulate the market downward.
So far so good, until we reach the barbarity of the expropriations. Was not it easier to give a little and meet with the commercial sector employers and reach an agreement? Furthermore I believe that the trade sector may have held a little higher prices because many of them already have their prices to the dollar to 10 BSF. I'm not saying they are saints, but closing stores and expropriate.
What money does the State expropriate? has not yet fulfilled the commitments of the previous expropriation and income have been reduced so?. Where is the generation of trust?. At this rate the possible positive effect the devaluation happens very fast and have the same risk, with a dollar more expensive price.
If the intention is to suppress the production system and the financial and corporate sectors of the country to do succumb, are on the right track, I just hope that the road does not end up scorched themselves.
Until next delivery!
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