Changing storm: Could 24-you be the key to cross it? Is there light at the end of the tunnel? And the joke on the band

Dollar and Risk country flirting with 1,500. Is the beginning of the end or the beginning of a change? This type of question flooded the thinking of investment decision makers, when the government played a “All or nothing” In medium -term legislative elections. That’s why They do not understand in the market, how the government, with experienced people, or rather surviving of recent crises, goes out to calm the spirits warning that they are or the abyssabove all, because not only an electoral triumph is not guaranteed, but after Buenos Aires they also lowered the chances of this happening. The reading of the consensus is that the economy was already playing against, and some of that was seen in the Buenos Aires elections, and today the economy is the enemy, in what they were supposedly experts for common people. It’s like everything is upside down, said a well -known “bonero” who did not stop launching orders for the sale of his customers and his own wallet.

Thus while some continued listening to political scientists and analysts, still unraveling the “7-S” to glimpse the 26-O, and others some other guru in search of a “Illuminati”Argentine bond sales orders flew through all heavens. Virtual and face -to -face encounters were not only express but to bone. Very few looking for official explanations. Nothing collaborated the reaction of the Government after the Bonaerense setback. Everything that is being seen in these exchange and financial wheels was projected for the previous weeks of 26-O. The advancement exacerbated the mood and fears. That is why in order to clarify, something, the panorama, at the tables they concluded that the heart is not the votes, but the relationship of the government not only with the provinces but with the society itself. They do not see a bench problem because Milei already survived two years like that, and with less benches he could sustain many decisions and get several laws. What they see is that, if the relationship with the governors does not change, who are the ones who discipline Congress, and make the provinces play in a renewed trust relationship will not be sustained.

There is no longer talk of percentages for 26-OThey believe that it only needs, in addition to shrinking the difference in Buenos Aires, at least win by a vote in the accumulated nationwide to show, even, to be the most voted force. The Congress will not be very different from the current one, only half is renewed, and the distribution of benches will not change the panorama. That is why he understands that It is not a problem of votes, but of government linkage, and especially of the president. They know that Kirchnerism is with the knife between the teeth, not only because of the affront of Cristina Presa, but also because having lost territory, governorates, intendencies, as they are not in management, the positions are radicalized. So how to get out of this mess. The bad praxis is already made, there is no reversal in the issue of accumulating reservations with such export liquidationand that is why the numbers of the RIN return to the rodeo: the gross reserves of the Central Bank (BCRA) almost 40,000 sticks, but the liquids are about 18,000 sticks, which are not their own (they are the gross less the gold about 7,000 sticks, the Chinese swap without using about 13,000 sticks). But when separating the straw from the wheat, the assets of the liabilities, These liquid reserves are alien: the lace of the argening, the IMF disbursement, the Basel Bank SWAP, the government deposits and the future payments for the Bopreal. Therefore, net reserves are negative.

As a consultant explained to the table of an international bank, the small print of the agreement with the fund says that when the exchange rate falls in the band below and in the one above they sell, now, if there is a “Side Letter” that puts limit to the intervention it is not known. The truth is that for operators the country’s risk rise is due to the risk of selling reservations. That is why they crush with not accumulating reservations was bad praxis, and taking out the stock was a shot in the foot. For months the market looks at what the “Toto” does and not what Milei says. Now at the tables they try to estimate the exchange rate that allows the debt to pay, since there is no access to the voluntary debt market, with the open capital account. So from here to 26-O, every dollar that is lost rises the thermometer, and the pressure on the country risk. No one talks about the budget project that was old. The so mentioned “TMAP” ends up being as far from reality. And since the humor and ingenuity of the market does not stop, despite the bleeding, The most listened joke was that the dollar left the band and began the solo race. A good synthesis of the current situation. A prestigious economist with history at Wall Street and Washington, who held a high position in one of the last economic teams, ended his meeting with clients saying that not everything was lost, but better to turn several candles and cross his fingers.

An ace in the sleeve or a drowned swing?

Meanwhile, exchange and financial, in a market where the vendors rained, At the tables some insisted that the only light at the end of the tunnel is that in October the government achieves veto capacity. However, in a financial redoubt, where several private fortunes are administered, they lit some candles, but speculating with an ace in the government of the government, which some will interpret as a drowned swipe, which baptized “24-s”. What is it about? It happens that, while the dollar and the country risk scale and the BCRA sells reservations, Milei will perhaps have the chance to enforce Scott’s promise, which is neither more nor less than the US Treasury secretary. The thing is Besent had said after visiting Buenos Aires in mid -April that Washington was prepared to assist financially, via a treasure helper line, to Argentina if necessary. Milei will go to New York to the UN Assembly, but during his stay he will see Besent in the ceremony in which he will receive one of the three global citizen prizes of this year Atlantic Council. On stage Milei will be accompanied by Besent. The market discounts that it will not miss the opportunity to remind you of your promise, in addition to adding the head of the background in its crusade to calm the markets. The only announcement of a line of savageness in the Chinese wall could temper the pressure not only exchange but on the sovereign bonds. We will see, if at least this promise is fulfilled, such as the one promoted by Milei in his electoral campaign that had 20,000 banks. At least that Milei brought that New York twine, they prayed on the bunker.

But at the time of bifes, and despite everything, consultations on What to “switch to the tooth”as they say at the tables. In this regard, there was a lot of talked about the options provided by the Bopreal B and C (they have carrot of the “put” for ark) and the corporate bond portfolio assembly law NY that can give a flow of funds of 8% annual. As for the bonars and global, the tires of the short section (at 29/30) offer more than 23%while the rest at 35/41 17%, GD 29/30 of 18%, and GD 35/46 15%. The strategists advised that the legislation differential under this situation was not worth. There they also threw the data that the position sold of the BCRA in future brushes the 7,000 sticks, or more.

Already the visions of rethink Summit were almost obsolete as the 2026 budget but from the outside, the point to point with New York and London realized that they know that The commented recovery of Argentina stopped in the second quarterby not consolidating the progress achieved in the previous three quarters. They see that, after three solid quarters, economic activity now shows signs of exhaustion, with a generalized fall, driven by the weakening of the private sector. They emphasize that recovery is losing strength despite the fall of inflation and the improvement of fiscal metrics, and that The advanced indicators point to greater weakness in the future. On the value of the dollar, already above the upper limit of the band, they say that it highlights the continuous financial tension and political uncertainty. In this framework, Investor trust is deteriorating rapidly before the October electionsas doubts in Milei’s ability to sustain reforms amid the growing political resistance and market volatility.

Argentina, in everyone’s lips

Argentina was again on everyone’s lips, particularly among the funds operating in emerging markets. From Boston to Paris, the Buenos Aires elections were discussed. As explained by Argentine experts: the dilemma was raised if the government raised the anchor and went to the band’s ceiling, which finally happened by market pressure, since, after the electoral defeat, the government tried to start rearming its policies in view of the October elections, although without changing the course. Thus, from the economic flank, the first measures aimed to reduce the monetary squeery lowering the reference rate they are setting from the simultaneous wheel (the Government reduced the interest rate to TNA 35%in more than 1,000 basic points). But the loss of rates did not initially affect the performance of the dollar, beyond the initial blow caused by electoral defeat. However, In the last tender, $ 0.6 billion left free, which, together with the decline of the fees, promoted the demand of the dollar.

On the other hand, Recessive data in industry and construction were maintained, accompanying the greatest uncertainty and the strong increase in the cost of moneyimpact that would be extensive to the entire economy with some exceptions such as mining and energy. An investor commented that he crossed in New York with the people of Grit Capital Group (Walter Stoeppelwerth and Joaquín Bagues) who, apparently, were from Road Show visiting investment funds and companies to test the political and economic expectations post elections in Argentina, that is, how the world sees the future of the country. But it seems that they were not alone, the politicians, Catalina Buitrago and Joaquín de la Torre accompanied them.

Meanwhile in London, neither the subway strike nor the heavy rains were able (Tellimer). The experts discussed if the markets had exaggerated the results of the provincial elections of Buenos Airesand even risked forecasts for the intermediate elections of October. There was also talk of the future monetary and exchange policy, the accumulation of reserves, relations with the IMF and access to the market. The city of Luz was also an epicenter of a debate of EMTA members in which they analyzed the effects of the weakness of the dollar, the resilience of emerging markets and general macroeconomic perspectives. But the qualified panel also took care of the surprise result of the provincial elections of Buenos Aires. In addition, the perspectives for Brazil, Colombia, Mexico, Türkiye, Egypt, among other issues discussed. They were from the game: Agnese Melbarde (Ivo Capital Partners), Claire Dassaux (Axa), Ramona Moubarak (BMI, a Fitch Solutions company) and Guillaume Tresca (Generali AM).