On Thursday, January 6, the Central Bank announced an increase in interest rates on Leliq and on time deposits.
Although these changes mainly affect, by definition, interest-adjusted investments, It also modifies the conditions in the fixed terms UVA + 1%, whose indexing factor is the inflation measured by the INDEC.
Leliq: three reasons that led the BCRA to increase the rate and what risks it entails
How is this? UVAs are 90 days long and have an option to pre-cancel after the first 30 days. However, In the event that the saver uses this right, his money will not grow at the rate of inflation plus a margin of 1%, but will be adjusted by 34% of the nominal annual rate (TNA).
Who win and who lose
Until before the change, UVA fixed terms that were prepaid granted a rate of 30.5 percent.
Pre-cancellation of PF UVA + 1 may put savers at a disadvantage compared to holders of common time deposits.
Although the change favors those who choose this type of deposit, In the event of a pre-cancellation, they continue to be at a disadvantage compared to those who bet on traditional fixed terms which, in the case of individuals who have less than $ 10 million, now give a return of 39% of TNA.
While legal persons or savers with more than 10 million, are granted a 37% of TNA.
The main advantage of UVA fixed terms is not given in what happens in the case of a pre-cancellation but for those who take them to the last consequences and manage to beat inflation.
On the other hand, traditional time deposits can be subscribed for 30 days.
Rate hike for some
Thus, The main advantage of UVA fixed terms is not given in what happens in the event of a pre-cancellation, but for those who take them to the last consequences and manage to beat inflation. The risk, however, is that some event will occur with the exchange rate in those 90 days.
With the rate hike, the BCRA joined the club of central banks that become more contractionary
Perhaps because of this last danger or because of cultural issues and ignorance, UVA time frames continue to occupy a very small portion of the general time stock stock.
Nowadays, they represent only 4.6% of the time deposits of the private ones.