Corporate issuance: record in June, marked by currency uncertainty

In this way, 27 negotiable obligations were issued for a total amount of $786,684 million, of which 12 were tenders in the dollar linked segment for a total amount of US$607 million, representing the largest amount of issues in said segment, both in volume and nominal amounts, since October 2023This information comes from the 35th edition of the PwC Argentina Capital Markets report

This increase was mainly driven by the resurgence of dollar-linked placements, in a month in which the market showed signs of uncertainty on the exchange front, according to the document.

Thus, despite the approval of the Bases Law, “There is still economic volatility, which ended up impacting the market and will surely continue to do so in the coming weeks and months.“, the document indicated. The expectations of a devaluation of the official exchange rate led to an increase in emissions tied to the dollar. In turn, the jump in the price of financial dollars, and also in country risk, led to a reduction in Hard Dollar emissions.

Significant increase in corporate emissions

“In June, we saw that the average placement margin (TNA) was 1.6%, largely reflecting the market’s appetite for this hedging instrument against the variation of the official exchange rate. At the same time, there was a decline in the tenders of ON in hard dollar of 62% in nominal amounts and 25% in volume, compared to the previous month. Additionally, the average placement rate (TNA) of these instruments in hard currency was around 6.6%, without major variations in relation to the previous month” he commented. Juan Tripier, director of PwC Argentina from the practice of Deals

The report also highlights that in June there were 10 FF issues in pesos for a total amount of $ 57,982 millionwhich represents an increase of 38% in terms of nominal amounts and 11% in volume, both compared to the previous month.

The average placement rate was around ~37.3%, in line with the previous month, although a 10% decrease was observed in the average duration, which stood at 3.9 months.

“Due to the latest adjustments in monetary policy, hThere are expectations of an increase in rates in pesos, which although did not seem to be materially reflected in the placement rates during the month, did so in the emission periods/duration, which showed a reduction compared to the previous month,” concluded Tripier.

In conclusion, June was, along with February, the month with the highest number of issues in all of 2024, which shows that more and more companies are returning to the capital market and allows us to infer that this trend could continue in the coming months.