Argentina’s Central bank international reserves have fallen below the 40bn dollars benchmark, which is the lowest in six years, according to the bank’s official data. So far this year the drain has been 3.48bn dollars and 12.84bn from the record 52.6bn of January 2011.
But JPMorgan-Chase & Co anticipates they will drop further, to 37.5bn as capital controls erode the country’s trade balance. The estimate of a 5.5bn decline in central bank funds this year assumes that capital controls will prevent a pickup in private-sector outflows.
This means Argentina’s international reserves loss was 8% this year and 24.4% in the last two years with a sustained decline tendency. The latest data took into account the fall of the international price of gold and payment, capital and interest, of locals bonds.
“Capital controls threaten to exert an adverse toll on expectations of economic performance” JPMorgan analysts including New York-based Vladimir Werning wrote in an e-mailed research report.
Argentina’s trade balance surplus will be 9.6bn this year, according to JPMorgan, down from a previous estimate of 11.6bn.
JPMorgan cut its 2013 “agro bonus” forecast, the estimated increase in agriculture-related exports, to 4.8bn from 6.7bn. It projected soy crop output of 45 million tons, down from a prior estimate of 51.5 million tons. The bank raised its corn output estimate for this year to 25 million tons from 24 million tons.
YPF the oil company that the Argentine government seized in April 2012, as projected to import 600 million dollars worth of fuel this year.
On Thursday at the end of foreign exchange trading in Buenos Aires, the official price of the US dollar was unchanged at 5.11 Pesos (buying price) and 5.165 Pesos (selling price) while the so called blue dollar traded at 8.63 pesos (buying price) and 8.66 Pesos (selling price).