Promise of dollars: from the US, Luis Caputo sweetens the ears of the market and generates expectations in investors

The Argentine bonds nominated in dollars They are already trading in the green at this time on Wall Street, thus ending a streak of more red than green in recent days. And the market celebrates the advances it reported the Minister of Economy, Luis Caputo, in terms of financing, such as the almost three-year loan with private banks, in REPO format, to face the payment of debt capital to bondholders in January and a possible return to international credit markets to refinance the July maturity, ” “if rates allow it.”

Pablo RepettoHead of Research at Aurum Values -in dialogue with Scope– maintains that since early this Thursday he perceived a positive effect on the opening in foreign markets. And the possibility of having a positive flow of organizations mitigates the risks of restructuring, although in any case they remain high according to the prices at which Argentine debt operates.

The strategist warns that it is important to consider that the advertisements are in gross income, so it is necessary to deduct the payments and the part corresponding to the private ones. However, he recognizes that if Argentina manages to improve its reserves and global support facilitates the elimination of the stocks, “in the coming months, the possibility of accessing the markets in June will increase as the country risk decreases.” In this context, it does not rule out a country risk of 700 points in the second quarter of 2025.

It is worth remembering that dollar debt extended losses throughout this week in line with the rest of the emerging/frontier fixed income markets.

For its part, Santiago Lopez Alfaropresident of Securities Patentslips in statements to this medium that the sovereign debt in dollars is expected to “all the way up.” In this context, he points out that “at these levels the bonds continue to have a buying opportunity” and that “There is no reason to sell.”

For Juan Pedro Mazzastrategist Cohen, believes the REPO loan is good news for the financing of the Argentine bondsas it strengthens the Central Bank’s reserves and provides the necessary funds to pay the January 2025 maturities,”that were already partially discounted“For the expert, this confirms that the Government found a solution. However, there are some points to take into account, he highlights:

• Repo Conditions: The repo could offer better conditions than expected, with a term of three years. Although it is still in negotiation and has not been closed, it is likely to be finalized under more favorable conditions, driven by the recent rally in sovereign bonds, making them more attractive to investors.

• Financing from the World Bank and IDB: Although the announcement of the US$8.8 billion is positive, it is necessary to analyze its real impact. “This financing was mentioned on several occasions. It must be evaluated how much of this amount is really fresh, how much will actually reach the Treasury, and how much will go to the Government. In addition, it is crucial to know whether these funds will be received now or in three years, since there could be prior financing included, reducing the real amount available,” the strategist slides.

• Market Exit: Mazza adds that the intention to go on the market in June was always present and does not represent a novelty. The interpretation is that the Government does not currently feel the need to guarantee how the January payment will be made. “Instead, it hopes to observe the dynamics of reserves and country risk before deciding how to face that commitment, which will surely begin to be discussed at the beginning of next year,” he concludes.

“A lot of good news”

For Gustavo Neffapartner of Research for Traders, We are facing a wealth of good news. The analyst considers that Caputo’s tour was very successful. “It seems that the planets are aligning in favor of the Government. In the last two months, there were many recommendations to change banks, particularly towards North American institutions, which undoubtedly favors the Government in its objective of continuing to reduce the cost of financing,” he explains.

However, Neffa warns for a more challenging international scenario. This is because 10-year US Treasury yield rates are rising rapidly, rising from 3.60% to 4.25%, slowing further recovery in bond prices. “Despite this, the good news continues, and it is likely that we will see some additional increases, although at a different pace,” he says.

For the expert, little by little, the financial program for next year is closing, with the entry of dollars into the reserves. The REPO announcement is a great advance. “We already knew that Santander would participate with one billionand now more related good news is being confirmed,” he maintains.

It is important to take the financing from the World Bank and the IDB with caution, since some had already been announced and are not new, while others are directed to the private sector, where loan lines are optional. However, the entry of these funds into the reserves is undoubtedly very positive news, concludes Neffa in line with what other analysts stated.

The recommended strategy

The investment advisor, Gaston Lentini, He shares with this medium his comment sent to clients and adds some considerations about what is coming for Argentine fixed income. For the analyst, the announced money is very good because there is a need to execute infrastructure worksbecause the streets must be repaired and because it is urgent to launch the infrastructure in the country.

At the same time, he warns that it is good to increase the BCRA’s reserves, but at the same time he considers a great risk: “that they rush to lift the stocks” and that this results in all the capital that is within the country due to the very existence of the exchange restrictions want to abandon it. “There is the key and the most important risk why it is no longer lifted from my point of view,” he analyzes.

Like the rest of the city’s strategists, Lentini remains “bullish on sovereign bonds“, recommends those of foreign law and in that aspect shows a preference to add to the portfolio for the Global 2035 (GD35) due to its low parity and the Global 2030 (GD30) to collect coupons soon.