After this Tuesday’s beating, Argentine debt securities in dollars rebound, from the hand of a incipient improvement in general mood. Anyway, country risk remains close to 2,200 basis pointsimplying a worsening of more than 20% this month alone.
The price drop does bonuses now cost up to 20% less compared to mid-January, when the government announced the buyback.
After noon, most bonds were bouncing after closing in the red strong the day before. Improvements went as far as exceeding 4%as in the case of Bonar 2029. Global bonds, with foreign legislation, mostly rebounded by more than 3%
The entire Argentine debt curve looks red this month and in many cases the gains that had accumulated since the beginning of the year have been erased. The announcement of the buyback of Sergio Massa has not moved the needle: Argentine bonds tumble as does all emerging debt as global investors eye the Fed’s next steps.
“The tailwinds that began in October with the easing of early US inflation data and encouraged the squeeze on long-term rates reversed sharply. As the 10-year rate traded below 3, 4% in January 2023, triggering strong risk appetite globally, soared rapidly in February, currently reaching the verge of 4%,” they explained in PPI.
“More adverse outdoor climate has put pressure on domestic assets, both dollars and ADRs, despite the latter looking to get some breathing room amid lower investor appetite for emerging markets and also due to heightened concerns about the electoral scenario and economic challenges ”, said the economist Gustavo Ber.
“THE global risk aversionwith its epicenter in a sharp hike in US Treasury rates amid longer inflation expectations and the Fed’s hawkish tone represent a complexity to manage in this transition phase up to the electionswhere daily delicate imbalances of excess pesos and shortage of dollars must be managed to avoid resulting in renewed exchange rate and inflationary tensions”, he added.
In the stock market, although Argentina’s ADRs are trading mixed on Wall Street, the Buenos Aires stock market is absorbing the reds that occurred on holiday Tuesday. Then, after noon, the Merval index falls by 1.8%with most papers down.
Source: Clarin
