Javier Milei continues to generate curiosity in the main financial centers. Therefore, it was reflected by the caravan of funds and banks who have visited the Casa Rosada in recent weeks to evaluate the direction of the shock plan and possible investments. Conversations which, added to the visits of the IMF and the US Treasury, probably renewed the search for new funds.
The president admitted days ago that he is evaluating a new program with the International Monetary Fund to accelerate the exit from equities and a change in the monetary regime: “We could proceed with the conclusion of a new agreement with the International Monetary Fund,” he said Milei on La Red radio. a few days ago, and added that “disbursements by the Fund, other countries or investment funds could be envisaged to accelerate the system of currency competition”.
The Minister of the Interior, Guillermo Francos, received between 20 and 30 funds in the last few days. As far as she knew Clarionlast week he landed Jefferies Group LLCan American investment bank that last November valued seven Exxon areas for sale in Vaca Muerta at a billion dollars, according to the Río Negro newspaper.
There were also meetings with the CAF, The US investors arrived on a trip organized by Bank Santander and a delegation from the bank passed by Nomura, one of those interested in managing a loan with exports as collateral. The Japanese entity, Santander, HSBC and Citibank In 2017 they placed the centennial bond for $2.75 billion under the management of Caputo in Finance.
The visits coincide with the improvement of the financial picture (purchase of reserves for 10,000 million dollars, decrease in the exchange rate gap and country risk, financial surplus, recent exchange of debt in pesos and increase in dollar deposits), but also with a deep recession, along with difficulties in lowering prices and carrying out reforms with the support of Congress.
“I prefer to play it safe, as they say in the IMF, and aim for the target in the middle of the year. If they give me 15 billion dollars, I will open it tomorrow,” Milei said a week ago. But on Wall Street they are not so sure. “Let’s see if Elon Musk will contribute when he goes to visit him!”, said a trader from New York , looking in the mirror at Egypt, the second largest debtor of the International Monetary Fund after Argentina.
The Arab country agreed weeks ago with the organization to inject another 8 billion dollars on top of the 3 billion dollar loan signed in 2022. It will also receive development aid from the United Arab Emirates for 35 billion dollars and yesterday from the European Union committed another US loan. $8,000 million. “It is no coincidence that they have devalued and funds have arrived, they will certainly not be free,” said the same fund.
The Minister of Economy, Luis Caputo, has agreed with the Fund to present a roadmap at the end of the month to revive stocks and abandon the “blend” or exporting dollar in June, but it resists devaluation and requires more reserves. “All the adjustment made in the short term, tied with the string, eliminating the stocks would eliminate the PAIS tax, right?” they ask in another New York fund.
Last Tuesday Francos received the financial director of the investment bank Morgan Stanley, Steven Vanne, together with representatives of five other funds, such as Nicolás Rodríguez Brizuela Artisan Partners, United States), Davide Amico (Canyon, United Kingdom), Robert Gibbins (Autonomy Capital Research LLP, United Kingdom) and Branko Maric (Discovery Capital Management LLC).
At that meeting the visitors presented “possible future investments”. The potential, something that repeats itself, reveals the challenges Caputo faces in convincing himself that he has a plan to exit stocks without causing a run, and political support to ensure the “sustainability” of the adjustment, after the joke arrest suffered by the DNU last Thursday in the Senate.
This task is probably more difficult with investors who bought the 100-year bond that the current minister assigned to them and were trapped. This is the case of Fideliy, a fund that visited the Buenos Aires offices last week.. The tour included EMSO and GLG MAN in the fund, where Córdoba’s Guillermo Ossés, with previous experience at HSBC and PIMCO, monitors Argentine debt.
Right now all eyes are on the May 25 pact with the governors. Without this agreement to approve the Bases law and the new tax package, it will be more difficult – Wall Street believes – to generate confidence. “Caputo knows the markets very well, he won’t say he got the funds without first accepting,” said Javier Timerman, a partner at AdCap.
Source: Clarin
