The government is preparing to new bond exchange for next week with the aim of decompressing the financial front in November and December. The idea is to postpone at least half of the $ 1.7 trillion that accrues in those months and gets funds to meet other expenses of the public sector for over 700 billion dollars in the rest of the year, when the tax requirements are higher for the payment of the semiannual bonus and pensions.
Right now, the Ministry of Economy is in discussions with banks and other institutional investors to complete the closing of the basket which will be offered between Monday –$ 30,000 million expires that day- and next Friday. The authorities are considering the relaunch of a dual bond, as in the swap in August – the first after the hiring of Sergio Massa -, but in this case, inflation hedging (CER) and a fixed rate would be contemplated.
With that menu They aim to extend between 50 and 60% of the deadlines for next year. Of the total pledges of $ 1.7 trillion in November and December, half is in the hands of the private sector. The Treasury tries to extend the debt renewal terms as much as possible, but in the case of the public sector it is not so easy, since some entities have to meet management obligations.
In the last auction in October, Economía achieved the lowest level of renewal from investors since last June, before the pesos bond crisis that ended in a race against the peso. The Treasury did it capture $ 148.009 million the issuance of securities with fixed and adjustable rates for the dollar through July 2023, against maturities of 134,604 million dollars, which meant a residual financing of 4% after the cancellation of the payments.
The government has raised the rate it pays to place the debt, which increases the cost of borrowing in the case of CER bonds. Therefore, in the last auction, it opted for fixed rate securities (LEDES), which in October were allotted to current effective rate of 114%an increase of 26 points from the last round made by the former Minister of Economy, Silvina Batakis, and 45 points more from the last one under the direction of Martín Guzmán, according to Equilibra.
The improvement in yields indicates that investors migrate deposits to the Treasury from the Central Bank, where they get an effective annual rate of 108% for the LELIQ. The government strengthened it last Tuesday with a decree that obliges public bodies to invest their liquidity in the securities managed by Massa, with a wider range than pre-clearable invoices for up to 180 days.
The economy faces several future challenges. First, according to Equilibra, “the investors they lend less and less and for shorter and shorter termsdespite the regulatory changes and pro-market signals made since taking over the current management in Economics “.
Authorities are also closely following the disarmament of Treasury bond funds in the first half of October, which began to reverse with the BCRA’s purchase of bonds. And, on the other hand, they are already preparing to renew the deadlines for 7.3 billion dollars in 2023, the election year. Almost half is in the hands of the private sector.
Source: Clarin
