In the last week of November the securities appreciated. Almost 30% of the Central’s assets are made up of Treasury bonds in pesos.
Due to the effect of the rise in prices in the secondary bond markets in pesos, the Central Bank had an improvement in its net worth of $2.8 trillion in the last week of November, going from $9.8 billion to $12.6 billion. The value of the securities varied from $19.4 billion, on November 23, to $22.8 billion on the 30th of the same month.
The prices of local securities in domestic currency have been gaining ground in recent weeks as a option so that investors could hedge against a devaluation and its inflationary effects. The securities chosen by investors are inflation-adjustable (CER), dual and dollar linked.
It must be taken into account that it is more about technical gains. If the BCRA, for example, were to sell these securities to withdraw pesos from the market, the market price could decrease.
As 2023 begins, Treasury peso bonds nationally represented 10% of the financial entity’s assets. Now at the end of Miguel Pesce’s administration, They represent 29% of the entity’s assets.
According to the balance sheet as of November 30, the BCRA’s assets amounted to $79 billion, while the liabilities are $66.45 billion.
One of the doubts in the market is whether the new head of the BCRA (it would be Santiago Bausili), will continue with the policy of issuing for intervene in the weight curveand prevent prices from collapsing and the Treasury having problems renewing maturities.
Throughout this year, investors, mostly banks, have been buying and exchanging Treasury bonds and selling them in the secondary markets where the Central Board acted to support prices. Something similar to what happened with the public’s fixed-term deposits that banks discharge into remunerated liabilities of the entity.
Source: Ambito
