3 things you have to know before putting money

The savers they don’t have many alternatives to dump their leftover weights, due to the limitations imposed by exchange clamp to go to dollar.

Thus, the Fixed deadlines they become the most direct output and simple so that the average Argentine tries to escape inflation, and the loss of purchasing power of the surplus income.

Before turning to this tool investment and considering in context, we tell you three key aspects that you have to know before making one of these placements.

They are linked to the interest rates who are paying and the relationship with prices of the economy, where many analysts fear that their cost effectiveness will be diluted in the coming months.

1. Fixed term: uniform interest rates

According to the latest regulations of the central bank on the subject, since the beginning of June established that for the fixed terms for savers, “regardless of volume or business name, they must pay a Annual Nominal Rate of 30.02% (TNA) and an Annual Effective Rate of 35% (TEA), “it said in a statement.

This represents an increase of 3.4 percentage points with respect to what the financial system paid until the last business day of May (26.6% annually).

Beyond the official regulations, when the interest rate punctual offered by each of the main banks in the country, There is evidence of uniformity in the profitability offer towards its clients who seek to set a fixed term.

According to the data of the BCRA, all the leading banks (those that handle the largest volume of deposits in the system), uniformly, grant 30.02%, not one more percentage point, for both clients and non-clients. Fact that shows that the entities are not seeking to capture the saver, because there is a lot liquidity in the market for monetary issue. “If there is no minimum tax imposed by the BCRA, the rate of the fixed terms would probably be below “, he affirms to iProfessional Robert Geretto, Chief Economist of the CMF Bank.

Another bank representative says low: “No bank wants to pay more than that rate because it gives losses. We are forced to give 30% and we lose money with it.”

With too many pesos in the banks, little credit demand and the economic activity in the freezer, the financial entities “do not serve” to capture more national banknotes than they have, since they do not have to which clients to transfer them through loans.

In summary, the interest rates offered by ten banks they handle the highest volume of deposits They are:

In turn, the smaller banks, which are the ones that require capturing pesos for him Low volume of money that they manage through the limited portfolios of customers They do not provide an interest rate higher than that of the leaders. In other words, they are also limited to offering 30.02% per year.

2. Fixed term: return on the edge of inflation

The second question to analyze is if the rent of the 30.02% offered by fixed terms is attractive or not, as if to beat the inflation all year. In other words, if this rate is really positive with respect to inflation.

In the market there is a coincidence that in the first semester these instruments have behaved above the prices of the economy. Therefore, they have been a good bet for the savers within such a particular context.

“Today the Fixed deadlines yield at a rate of 30% per year, that is, a 2.5% monthly. Looking at the data of inflation of the last months we see that the fixed term had a positive performance in real terms, since the raise prices was from 1.5% monthly in April and May “, summarizes iProfessional Diego Piccardo, economist of the Freedom and Progress Foundation.

The big question is what can happen in this second part of the year, because the consensus of the economists local and foreign is that inflation will be in all 2020 close to fifty%.

That is, beyond the Fixed deadlines they performed well in the first semester, “does not mean that in the future it will be a good investment to keep the real value from our savings” Piccardo.

In fact, ending 2020 with a total of price increase close to fifty%, the current rate of placements in 30% would be negative in the same period. Especially since in the last semester the inflation would go above the current interest rate.

In this sense, he details that as the quarantine is lifted, “we are going to observe a increase of the inflation who will overcome the 2.5% monthly that the Fixed deadlines, reason why it is going to lose attractiveness to use this instrument “, warns

In summary, it concludes that beyond that this instrument has had real earnings at first semester, “does not imply that in the second semester the same thing happens because we envision a inflationary acceleration for the elevated monetary issue and increase in speed of money circulation because of the removal of the quarantine. ”

3. Fixed term: lack of alternatives, generates demand

He third and last aspect that can modify the balance in the choice of the fixed term, refers to the few alternatives that exist for “get out” of the weight in the midst of this difficult economic, political and financial situation.

With an increasingly strict exchange rate, for the shortage of Dollars in the coffers of central bankAccess to the exchange market to dollarize savings becomes complex. Especially because of the already existing limit of $ 200 per month.

Furthermore, the informal market It has prices close to $ 130, which are around 35% above the solidarity dollar ($ 97 with 30% tax). A level that seems high and not willing to validate by many. In addition to the setbacks that involve having to justify the acquisition and subsequent use of foreign currency from an illegal place.

Therefore, for savers they cannot buy in the official plaza plus foreign exchange than allowed, and who do not want to risk their surplus pesos in volatile stock instruments that are little known to them, the fixed term it becomes one of the few “safe” ways to avoid losing completely before inflation.

That is, for more than in the coming months the raise prices accelerate, better than having parked weights is to place them at term and get a rent at least close to the general rise.

The amounts placed in fixed terms in pesos fell as soon as the quarantine began but then rose sharply

At graphic you see how they started to go up the placements to Fixed deadlines during the pandemic.

“Before the pandemic, there was $ 1.2 trillion in this instrument and then, due to the fear caused by the coronavirus, they decreased to $ 1 trillion. But, currently, the private sector has $ 1.4 trillion in fixed terms of 30 to 59 days,” he concludes. Piccardo.-

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