The debt in dollars closed the week with rises of up to 2%, consolidating the optimism started on Thursday after the confirmation of the economic team trip to Washington to meet with the US Treasury.
The Sovereign debt in dollars Close the week with an optimistic tone and up close to 2%. The movement gives continuity to the positive dynamics of Thursday, when the dollar bonds climbed on average 3.2%. The improvement was enhanced towards closing, after confirming The imminent trip of the economic team to Washington to meet with Scott Bessent, secretary of the US Treasury.
Let us remember that The global ones had begun the second wheel of October with marked volatility: They came to bounce up to 3% in the premarket on Thursday after A new Besent post on social networks with more clues of support. However, that impulse was quickly diluted when it was known that North American assistance would be channeled, initially, through a SWAP with the BCRA for US $20,000 millionand not through the disbursement of fresh funds.
In spite of everything, this punctual rebound is not enough to erase the red of the week: the global are aimed at closing with an average loss of 3%, which adds to the strong casualties of September and accumulates an 11%setback. In line with this deterioration, and despite the good performance of Friday, The country risk remains comfortable in the 1,200 points. The truth is that we will have to wait A technical rebound that will serve as an exit, or if the perspective of investors really changes.
Meanwhile, The Treasury and the BCRA continue to use all their artillery to contain the dollar, in a exchange scheme that does not look sustainable far beyond October 26. Recall that the economic equipment can intervene directly in the change market through SPOT dollar sales, operate in futures or place dollar linked titles. Regarding the interventions in the spot, of the US $ 7,000 million extraordinary liquidation of the agriculture, the treasure bought only US $ 2,228 million.
We estimate that, after that offer, There could be sales between US $ 300 YU $ S500 million on Wednesday, and other US $ 200 million on Thursday, to contain the price around $ 1,425. In this way, the Treasury Fire Power after these maneuvers would remain between US $ 1,630 YU $ 1,830 million. This data is not less: It is precisely the cash available to face the next maturities of January 2026 in Bonares and Globalfor about US $ 4,200 million. Here the importance of this weekend meeting in Washington is understood.
Regarding intervention with dollar Linked, On Wednesday a debt exchange was held at a fixed rate for these titles tied to the official exchange rate. After practically exhausting its stock of the October Lelink (D31o5), it was foreseeable that the Central Bank will boost a new exchange to recover margin of action on the dollar Linked curve, in a context where we estimate that its position sold in future rounds around the U $ s7,000 million.
In this framework, The BCRA executed an exchange for US $ 7.3 billion titles at a fixed rate with expiration at the end of October (T17O5 and S31O5) for five dollar Linked instruments with maturities between November 2025 and June 2026. The operation allowed him to repeat the intervention strategy that has been applying since September 29 with the October Lelink. This time, the chosen bonus was the Lelink with expiration in November (D28n5), which yesterday operated at devaluation levels +2.2%. Thus we estimate that the game power in dollar linked instruments is now around US $ 6,800 million.
In short, The market seems to move in a delicate balance between the expectation of external support and the distrust of the sustainability of the current exchange scheme. The trip to Washington is emerging as a test of fire: a specific announcement could revitalize the debt and give the government air, but any diffuse signal could accelerate the pressure on the dollar and turn the volatility even more.
Team Leader of PPI strategy
Source: Ambito
