Martín Guzmán and Miguel Pesce, in the Senate, at the beginning of the year. Photo Juan Manuel Foglia.
“As a Central Bank”. This is what they believe in the debt swap market that the Ministry of Economy launched on Tuesday for holders of Ledes and Lecer securities, both expiring on June 30. The plan is to deliver more in October and December.
“The exchange is intended for Lecer and Ledes expiring in June that the Central Bank (BCRA) has purchased in recent days“explain the sources.
The monetary entity allocated about $ 300 billion to buy inflation-linked bonds and put end to the downside of those key instruments for Treasury financing.
Why does Guzmán do this? On the one hand, with the exchange of securities in the hands of the BCRA, he avoids requesting more transitory advances from the institution (to which he has agreed with the International Monetary Fund.
On the other hand, the BCRA, by buying the bonds, raises prices and lowers rates, helping Guzmán – who doesn’t have that much pressure to offer a higher rate – ahead of next week’s auction.
The cost of the transfer is paid from the balance of the Central Bank, with more Treasury securities in the assets and more Leliq in the liabilities.
Economy offers a basket of two options for each stock.
In the midst of the exchange, Minister Guzmán will meet starting this Wednesday with the bankers.
About $ 522 billion is expected next week. And Guzmán wants banks to accept more Treasury bills in their portfolios.
The debt in pesos
The city analysts believe that peace of bonds in pesos may only be momentary and that the effects of the crisis will continue until 2023.
According to the calculations of the consulting firm 1816, in the last five shifts the monetary authority it had to print $ 300 billion buy bonds and distribute them to debt holders in pesos.
The figure is nothing less: it represents a just over 40% of the total transitional advances that the program agreed with the IMF provided for for the whole year.
“FCI bailouts have slowed dramatically in the last three rounds, but this race still marks a before and after for the weights,” they pointed out in 1816.
“very difficult In the remainder of Alberto Fernández’s tenure, sovereign debt in pesos will once again be seen by the corporate world as a low-risk debt“they added.
“The government has made it clear that the reprofiling of the debt into pesos is not on the agenda”, The economist of Equilibra Lorena Giorgio said this in a report for his clients.
“But the problem – he added – is not the stock of debt in pesos, but the combination of a low propensity for instruments in local currency, and rates that until now were low “.
“It also doesn’t help that the Central Bank can’t buy dollars for its reserves and that it seems that it will have to continue issuing pesos to finance the fiscal deficit, “said Giorgio, who, while acknowledging that the government has tools to stimulate the refinancing of debt maturities, these imply”greater emission monetary policy and / or risk of overheating of the exchange rate and inflationary front “.
This Wednesday, the Minister of Economy, Martín Guzmán will meet the representatives of the Association of Argentine Banks (ADEBA) and the next day it will be the turn of the Association of Foreign Banks (ABA).
Source: Clarin
