The Ministry of Economy will return this Wednesday to the domestic debt market in search of pesos to finance maturities and address the public sector deficit. Given rising inflation and shrinking primary election deadlines, andThe market demands short instruments with higher rates and that is what the offer of the Ministry of Finance for the first bidding in April reflects.
For Common Investment Funds (FCI), in this call a Liquidity Letter (LELITE) will be put on the table. as of May 19 for $40,000 million face value.
On the other hand, there will be two Bills adjustable for inflation (LECER) to July 18 and September 18 for a nominal $20,000 million each. There will also be a letter of discount (LED) as of July 31 for a nominal $30,000 million. These letters will have a second round on Thursday for the entities that are part of the Market Makers Program.
Two dollar-linked bonds are also offered (T2V3D) as of July 31 and April 30, 2024 (TV24D) for US$100 million each; and a Bonus adjustable by CER (BONCER) as of August 13 for a nominal $20,000 million. The bonuses are not part of the “market makers” program.
According to the stock market company PPI, “just like at the end of March, the Treasury delayed the publication of the conditions of the tender” what he considers a “color detail that reflects the This difficulty will grow as the short-term window until PASO closes. by the simple passage of time.
On the first call of the month it will seek to meet maturities for $193,082 million, of which 67.4% is in private hands, while the rest form part of the portfolio of public sector entities. The bulk of this amount is explained by a dollar-linked bond (TV23) and an LEDE (S28A3).
PPI points out that “a wide menu is observed and very focused on short indexed alternatives” and considers it “expected” that the Treasury would include various adjustable alternatives for inflation given the March rate of 7.7%.
He explains that on Monday in the secondary market, “the July LECER yielded around CER plus 1%, while the BONCER yielded close to CER plus 2.6%.” PPI indicates that if both instruments are observed in nominal rate using the REM inflation path, LECER yields 124% effective annual rate compared to 123.59% for BONCER. But if the inflation forecast in the REM increases by 100 basis points (something very likely to happen) to an average of 7.13% per month lThe effective rate of the BONCER would go to 140.74% against the 138.35% of the LECER.
Regarding the bonds linked dollar, the T2V3 of July 31, the Alyc states that “at the market price on Monday, it serves to make a synthetic in pesos by selling the ROFEX position to July that offers an effective rate close to 156%”. Meanwhile, the LEDE for July (S31L3) is also reopening, which on Monday operated around 128% effective annual rate.
“In the last opportunities, andThe Treasury was validating slight rate increases, although always below what we expected. As a reference, the Treasury increased the TEA at which the new LELITE is going to be issued by 580 basis points (107.33% TEA; only for FCI)”, points out PPI.
Source: Ambito
