With the last debt tender in pesos, the Government seems to have positioned itself to try to comply with one of the points agreed with the International Monetary Fund (IMF), which is to stop using monetary assistance from the Central Bank to cover the primary deficit of every month.
In theory, now, in order to carry out the management, the Minister of Economy, Sergio Massa, should appeal only to the debt market in pesos. Last Friday, raised the debt rollover level from 133% to 141%, with an extraordinary placement. This Tuesday, when the second round is held for the entities that are part of the Market Makers group, that level will probably improve a little more.
The Finance Secretary, Eduardo Setti, breathes easier. By the end of the year he is managing to renew the government’s credit to private investors. The expiration wall that was talked about at the beginning of 2023 has already managed to pass it for 2024 and 2025. In the last tender in August, he achieved an extraordinary level of roll over. Of some $100,000 million that expired, it managed to raise just over $800,000 million.
The consultancy Ecolatina points out that “the authorities would close August with a net financing of $825,000 million, which would imply a noticeable improvement in roll over despite the recent turbulence: it would go from 150% in June and 120% in July to be located around 200% for August”highlights the consultant.
The most important thing is that, so far in 2023government already has accumulated $2.9 trillion of extra financing obtained in the capital market.
In the last tender, the following were offered: a new LELITE expiring on September 18, 2023, exclusively for Mutual Investment Funds; two CER (inflation) adjustable bills that were reopened: X23N3, maturing on November 23, 2023, and X18E4, maturing on January 18, 2024; and two CER-adjusted bonds: T6X4 and T2X5, maturing on May 20, 2024 and February 14, 2025, respectively.
644 offers were received, representing a nominal value of $1.1 trillion, of which $681,554 million was awarded in nominal value, representing an effective value of $822,272 million, which implies a refinancing rate of 828%. 24% of the financing obtained corresponded to instruments maturing in 2023, while the remaining 76% corresponded to instruments maturing in 2024 and 2025. In bidding, the average term of CER-adjustable instruments was 11.3 months.
Meanwhile, according to a report from the Congressional Budget Office (OPC), the maturities of the national State’s public debt, both in pesos and in foreign currency, amount to u$s73.440 million for the period between August of this year and April 2024. The greater weight of maturities will fall on the future administration, since in the last five months of 2023 they reach u$s30,395 million, while in the first quarter of next year they will be US$43,045with a monthly average of US$10,761.25 million, 77% more than in the first of the aforementioned periods.
Source: Ambito
