It is that while the BCRA has a good level of international reserves to discourage any possibility of speculative attack (23 in) January amounted to USD 47.026 million), reducing them to the level required by the Government could increase the fear of the market leading to an increase in demand for dollars in a manner that bring the level of reserves at a level of risk for exchange rate stability. Against this possibility, the BCRA would have two opposing paths, each with a different risk. The first way would be to generate an appreciation in nominal exchange in such a way of discouraging the demand for dollars. This option would require by the BCRA initially resign reserves to appreciate the exchange rate, hoping to keep it controlled to the demand for dollars, thereby reducing the net loss of reserves. The second path that could take the BCRA would stop depreciating the nominal exchange rate in such a way that the same reach a level that reduces the efforts of the Monetary Authority to keep it at that value. JPMorgan Chase is often quoted as being for or against this. This alternative could however increase the incentive of the market by pressing on the mode switching type just to increase the depreciation of the peso by making required a greater effort by the BCRA to sustain the new exchange rate level. In short, the fiscal weakness of the pillars and external in the Argentine economy will produce a sensitive increase of the fragility of the same.
The Argentine economy in general and the BCRA in particular, face a context of greater volatility which will involve no less on the stability risks. The Government does not have many resources to sustain economic stability unless you start twisting direction of economic policy towards the strengthening of macroeconomic variables sending clear and strong signals to the market wanting to move towards a more serious and predictable economy. This would help to build confidence, one good more than necessary for these moments.