Government in the sight: doubts, internal and absent political table
Both comments and what was heard and said in all those virtual and face -to -face meetings were for all tastes reflecting the High level of confusion and uncertaintymainly, about next steps from the government since they still consider that The initial reaction has been poor.
“Either they react and do politics, or take them positions”warned a opposition lobist that decades ago he knew how to occupy several public and legislative positions in a Financial breakfast near Malba.
According to your vision, what happened in Buenos Aires It was not a catastrophe to lla But it leaves a worse path to October, and advised that the result can confuse both Lla like the PJas happened to JXC in 2021 They read the electoral result badly. We will have to see if Axel sings a new song that excites own and strangers.
A survivor of several crises since the ’70s argued that what must be monitored is whether the Sensation of chaos Because it can affect the government, therefore, what happens with the economy in the coming weeks is key. Even for the riskiest, the hosts explained, there were Some “Carry” opportunities until October.
In a Call point to point with Wall Streetstill shaken by the magnitude of the official electoral setback, they concluded that Foreign investors did not yet release their hand to Milei’s governmentbut apparently in the previous one and after the Buenos Aires result it is obvious that They continued cutting positions.
There the rumors about the future of the economic team And the probability that be immole next to the president if this is derailsin this sense, the ones who know the protagonists best pointed out that they would allow them to doubt the patriotic feeling. There was talk of tightnessespecially after Disacted from the Lefiwhich now seems to be a orphan initiativesince no one is awarded, rather They throw it to each other.
What is discounted, in addition to the result of October, is a Program readjustmenta kind of “Service” of the 1,000 kmnot only of the exchange rate and the interest rate. They hope to see how “The lion” reacts at this crossroadswhich for now has disappointed with the Innocuous political table.
Carry, Rate and Dollar: Short windows in a tense market
Thus, one of the most demanded binomials in the market summed up the situation: the government seems to have changed your strategylet Run the dollarthat with little intervention it was sustained Below the upper band In the first days, while future intervention also began to be a little longer (Very operated the October contract by the BCRA).
At the same time, the BCRA released liquidity to the economy allowing The rates break down And he was encouraged to tender a Short letter at the end of Octoberto give more fluidity to the activity or at least shock the blow.
As follows?the million -dollar question: they believe that the BCRA is going to defend the bands to the electionbut the discussion is what is the Cost in terms of reservations and its eventual impact on the country riskhe Repo and the Dolk depositsboth keys to monitor in addition to the Electoral dynamics.
But at the time of bifes, “Jota Jota”a well -known strategist, threw some clues: at the sovereign risk level, the Argentine papers They differentiated themselves from US corporate bonds already at more than 1,000 basic pointsand the October result would define if Argentina returns to the markets or, paraphrasing the great Ferrer, must live with the own.
Today Argentine sovereigns yield 17.5%when a CC+ or b-rind 7.5 to 8.5% and are not in the delicate Bolivian situation. The parities say that there is a lot of uncertainty ahead.
But in him segment in pesos There are some Short opportunities Even the elections with the stratospheric rates in forcelike the Tamar in 66% per year and one inflation of 1.9% monthly what projected gives An annual inflationthat rate is a barbarity. It is one real interest rate of more than 3% monthlywhich is generating that with an exchange rate close to the ceiling of approx. $ 1,430a Carry who are taking advantage of the farmers who settled recently.
That is why the consensus is that After the elections this exchange scheme will not be held for a long time. Hence the market discounts this and “Break Even” of inflation from January 2026 rise to 2.8% monthly from 1.7% to Octoberand that is clearly seen for example in the TZXM6 (Treasury bonus in pesos with CER) and the T13 76.
That’s why “JJ” called not to miss for example Dual with tamar +8.5% wave TTS26 that is yielding 13.55% with tamar 65%that show a Very high monthly accrual (6%)and the TZX26 CER+20% For indexed instruments.
As with Buenos Aires elections, The key number is 40%if that achieves the government dream of the market with which The thing is reached. So that it will have to Wait and see how the Government gets to October And what do you get in the National Legislatives.
Political risk, suspense reforms and an economy without timing
While what was heard between the operations tables and their consultants was rather a replay of what has been noticed for months, it could be noted that, according to a foreign analyst, after Buenos Aires the political risk was exposed and suspense reformsbut There are no reasons to panic still that the reforms are revealed immediately.
However, he told local colleagues that structural weaknesses were visible for a long time: a fragile exchange regime, Makeup fiscal surpluses, missing structural reforms and one Weak political base. Combo flower!
The doubts are if Milei will continue, as he said on Sunday, the program to the lettersomething discounted until October. But the National Political Table It has a tofo to the failed May pact experiment And it could only be the basis for negotiating with the moderates if they lose in October.
An operator threw a brave survey out of the oven which shows that negative evaluation of the current economic situation over last year continues to grow for the fifth consecutive monthwhere almost a 60% consider that the situation is worse than last year.
This is worth because most economists warn that the economy It will arrive very battered to October. A not less. Anticipate that just mid -year You will begin to see some sign of recovery. So for the elections, the Real salary of formal workers will not play in favor of the governmentthat show signs of exhaustion in recent months.
Source: Ambito
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