On the first of the points, the market has been giving signals for several weeks now. It demands increasingly higher yields to stay with “Treasury risk”. For example, a Lecer maturing on April 30, in September yielded inflation plus 1.2% and began to pay CER plus 5% in October. The Dual Bond that matures on September 29, 2023 had a negative yield of 3.19% as of September 30 (added inflation or devaluation) and began to yield a positive implicit rate of 3.26% on October 21. .
About, the consulting firm Equilibra states that, although the market has become more complicated for the Government, this will not prevent it from reaching the end of the year well. Last week, indicates the consultant, the Treasury had a “demanding debt auction” because most of the maturing bonds were in private hands. “The Treasury obtained net financing for $36,507 million with a rollover of 124%,” says the report. For that he had to pay an effective annual rate of 113.7% against 108.6% in the previous round and a real rate of 3.49% for the LECER against 1.25% in September. The firm assures that “the 2022 financial program will not bring too many problems to the Government, but the great challenge is the maturities of the first 9 months of 2023, which already total $12.6 billion, equivalent to 7.5% of GDP.”
Martín Vauthier, an economist at Anker Latin America, warned that “the next tenders will have to be closely followed.” For Vauthier, the key is to know if the Treasury risks offering titles without premiums in relation to market yields. “If you try to cut the rate growth dynamics, you run the risk of getting less net financing,” he explained to Ámbito. He also considered that it is necessary to follow the Central Bank in the interventions in the secondary markets since in recent weeks there have been episodes of stress against bonds in pesos (of lesser magnitude than in June) and the entity came out to support prices. The economist argued that “the peso curve has become heavy” again for the government.
Beyond the issue of maturities, also in the last two months of the year, due to a seasonal issue, public spending grows and that implies greater needs for pesos to finance the deficit. Martín Polo, from Cohen, warned that in November and December “the government is going to abandon the fiscal discipline” that it has been showing up to now.
About, the private consultant Salvador Distéfano, maintained that the Government “cannot finance everything it wants” and that is why he considered that “the interest rate will continue to rise because nobody wants to take a risk for the State.” He posits that banks “no longer want to expose more assets to Argentine risk”after having obtained “facilities” of all kinds that the Treasury gave them this year so that they would agree to enter the debt auctions in local currency.
Instead, financial analyst Christian Buteler exposes a dissonant voice regarding the trends that the markets are showing in recent weeks. Consider that If a disruptive event occurs with the debt in pesos “it will not happen in 2024, but in 2023”due to the accumulation of maturities that is occurring, and that the Treasury is having a hard time overcoming, although the market continues to operate as if the risk were going to materialize with the next administration.
Source: Ambito
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