Silvina Batakis replaced Martin Guzman on Sunday after the untimely resignation of the official in charge of the portfolio, which deepened the bad mood in a market hampered by the weakness of the peso and the exchange rate gap of around 100%.
Argentina’s sovereign bonds renew historical minimum levels hit by a persistent offer current in a market without takers, at a time when signs are expected from the new Minister of Economy, Silvina Batakis.
“Silvina Batakis has a more heterodox profile and is facing a market that is asking for a more orthodox solution to correct the current imbalances“, said Research for Traders, noting that “the new minister will have to face inflation of more than 70% per year, a high fiscal deficit and a stagnant economy while maintaining dialogue with the International Monetary Fund (IMF).”
Argentina must meet quarterly goals agreed with the IMF, in the midst of runaway inflation, slowdown in economic activity and exchange pressures that complicate the role of the central bank (BCRA) and the accumulation of reserves, which led to recent restrictions on the import sector .
“In the medium term, the distorted incentives offered by the Argentine economy generate the reappearance of exchange problems and a vicious circle where new restrictions are implemented“, said a report from the association of agricultural entrepreneurs CREA.
Sovereign bonds in the OTC market lost 1.7% on average, after plummeting 3.6% the day before, with which they lost almost 20% since last April.
“These are difficult wheels for Argentine assets. This responds to the expectation generated by the change in the Ministry of Economy and it will be necessary to see the direction of the measures that are taken from now on“said Santiago Abdala of Portfolio Personal Investments.
Source: Ambito
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