:quality(85)//arc-anglerfish-arc2-prod-infobae.s3.amazonaws.com/public/UXAWHTBNKNBWROOFHMC5RG3GQY "In the public debt tender, there were rejections of tenders so as not to validate higher rates")
External debt obligations fell more than 4%. For example, the Global 30 (GD30D), which is favored by a government buyback plan, fell 1.8%. Since the launch of this official strategy, which is also used by the government to control financial dollars, the GD30D, the bond that would be used to obtain 1,000 million USD in a REPO operation, has lost 2% of its value and now its price It is at USD 32,447, very far from the 40 USD that must be reached for the operation to be possible.
The questions the market is asking about the $1 trillion loan the government is considering
Amid a sea of guesswork, traders are closely watching the price of Global 2030, the bond the Economy Ministry hopes to use to close the deal
Country risk, given the adversity of debt securities, lost 29 units (-1.5%) and rose to 1,997 basis points. After noon, he had pierced the 2,000 points.
“The parities are being destroyed and this is what this bond buyback plan does not make us understand, where the opposite objective to that proposed has been achieved”, declared Salvador Vitelli, financial analyst and expert in agro-industry.
Global financial markets were in the red and Argentina could not be outdone
In line with Wall Street’s falls, the Buenos Aires stock market fell 2.2% in dollars and debt bonds suffered as emerging markets fell
The financial dollars remained stable. MEP rose 97 cents to $356.23 and cash with liquidation lost 40 cents and closed at $368.52. The “blue” fell $1 to $378 and in the wholesale market the dollar rose 38 cents to $199.46. The government insists on maintaining the deferred exchange rate.
The Central Bank had an additional cost. It sold 292 million USD of which 262 million USD is explained by the payment of energy imports. Reserves fell from $454 million to $39,555 million. They broke through the $40,000 million floor, unheard of since December 21.
After the inflation data, the presumption in the market increases that there will be higher interest rates
January’s CPI came as no surprise: CER-adjusting government securities didn’t budge, unlike on previous occasions
“With this number, we are over $1 trillion in sales so far this year and that takes us even further away from the target we have with the IMF in the review we are going to have at the end of March. With the today’s sale we have net reserves below $5 billion and further away from the $7.5 billion agreed with the IMF, although with this prepayment system they estimate we would save 2, 1 billion dollars, the problem is that we are in a very fragile reserve scenario to carry out these maneuvers. In fact, the foreign exchange earnings of agriculture amounted to barely 10 million dollars. Exporters liquidate So far in February, they have liquidated $340 million, which is down 75% from last year and below the historical average of around $60 million a day” , underlined Vitelli.
“Until now, it was estimated that $14 billion would be lost this year due to drought. But the early frost warning is out and this weekend could be quite cold. Now they estimate the loss would be $18.3 billion, or 41% of what was liquidated last year,” Vitelli added.
On the other hand, the offer of treasury bonds confirmed that the market is asking for higher rates. He came to pay 118.2% cash per year for a letter of remission which expires in May. This is the second highest rate since the auction of these bonds. Last November, a record 118.3% of annual cash was paid out.
A sign that the market is looking for significantly higher rates, the Ministry of Finance did not want to validate them and left out half of the offers.
Finally, 401,680 million dollars were raised to repay 300 billion dollars, ie there remained a surplus of 100 billion dollars to cover the next installments.
The most sought after, which shows great commitment to rising inflation, was the letter that adjusts to the CER and expires on July 16. This title captures nearly 53% of the offers, or 214,710 million dollars.
Bonds maturing in 2027 had little success and all supply came from the public sector. The Treasury raised $34,823 million, or 8% of what was collected.
Another fact that caught the eye was that the highest inflation corresponded to the most protected sector in Argentina: clothing and footwear. “This sector is like a wolf hunting in a chicken coop. In real terms, they increased by 39% in a year when other sectors such as health and communication fell sharply. At the same time, there was talk that the rise in meat prices was going to be the cause of the overheating of inflation in January. The truth is that, if you look at the general index, the best-selling cuts have increased between 3 and 3.5%. Greengrocers are the sector that has grown the most. Meat didn’t hit in January, which doesn’t mean it didn’t hit in February.”
Stocks were weighed down by lackluster data out of the US on rising retail sales, another sign that US inflation is intact. The rise in the New York Stock Exchange was slight as it reversed the trend as soon as the data was released.
With transactions for 3,782 million dollars, the S&P Merval, the first stock market index, lost 1.35% in pesos and 1% in dollars.
Business in ADR – participation certificates listed on the New York Stock Exchange – increased to 6,591 million dollars as a good turn was expected in the United States. The close was negative and notable exceptions were Ternium (+5%) and Edenor (+3.75%) despite the crisis Edesur endured.
Gone is another hectic wheel. The Ministry of Economy no longer has measures to control inflation and has little left in the reserves to contain the dollar. The market knows it and the dollar versus bond duel will be repeated today.
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