Investors are moving towards the mid-term legislative election considered key for the ruling party, where half of the Chamber of Deputies and a third of the Senate will be renewed. If the result of the PASO is maintained, the ruling coalition would lose its majority in Congress to the opposition.
Investors’ attention is also focused on the recent price controls to tame high inflationary pressure, which climbed to 3.5% in September, and exchange regulations, amid the firm fiscal deficit fueled by monetary issuance and a slow negotiation of debt with the International Monetary Fund (IMF).
“As important as what the post-election government will do (where they declare that they will try to avoid an exchange rate jump) is how much they will be able to extend the chosen path”, said Roberto Geretto, an economist at Fundcorp.
For its part, the consulting firm Delphos Investment estimated that “The new price freeze measures appear to have had a negative influence on inflationary expectations in the medium term and on the demand for pesos.”
Country risk and bonds
The Argentine Country Risk measured by JP.Morgan bank It was up 10 units, to 1,683 basis points, a new all-time high since the 2020 debt swap.
In turn, sovereign bonds denominated in dollars fell 0.2% on average, in a reduced and selective trading market, after accumulating a drop of 2.3% last week.
“In bonds there is another issue, which is that it is not yet clear if Argentina could return to the capital market, beyond a change of government. And here is the main question, given the possibility that we will have a new event of credit, which does not necessarily have to be a default, but a restructuring or something else “said Pedro Siaba Serrate, from Portfolio Personal Inversiones.
“As much as the context changes and is favorable, this weighs on the titles”, he claimed.
The indicator prepared by the JP.Morgan bank it pierced its previous ceiling of 1,669 points, reached at the end of last March, on Friday, climbing to 1,672 points.
For its part, dollar linked debt in pesos it was listed with most hikes, with the bullish leadership of the long section of the curve. At the same time, CER-adjusted securities were trading slightly downward.
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