February 7, 2025 – 00:00
At the tables the election year has already begun. The operators consider that it is key to design the 2025 strategy whether the primary ones are carried out or not. Another issue that causes a stir is the crisis for the tariffs that come from the north.
- Gradually the rhythm of the meetings between consultants and investors is resumed while some stretch a little more the summer period and the promos of the Esteños ferrys, but at the tables the electoral year began to be played. In this regard, operators consider that it is key to design the 2025 strategy whether the primary ones are carried out or not. Hence, the first virtual meetings have a more political bias, in order to evaluate the panorama with a view to the mid -term elections. In this context, the meeting of the Chamber of Deputies convened for today (February 6) is considered the first attempt to approve projects by the ruling party, in a framework where political forces in general show a picture of division and internal conflict , which makes them convenient for the suspension of the step.
- On the march of anti -fascist protest organized by the opposition against the speech of President Milei in Davos, the reading they make in the market is that it had a relative effect, it was an important but not politically decisive act: the negative for the president is that he had that with respect to its extreme positions, which has a cost for a leader like him, who makes the extremism of his positions an axis of his policy; In favor of Milei it is that the LGTB minority groups occupied the central place of the mobilization and that reduces their support and representation and there was no clear opposition leadership and the political issue through antifascism was in the background in front of the orientation sexual. What the march confirmed for investors is that the country is divided into approximately two halves, but the opponent lacks leadership and is very heterogeneous electorally; But that does not happen with the one Leaded by Milei, who brings together electorally and has a clear leadership. Everyone is clear that the Government will continue with its policy of de -financing of these radicalized minorities and this will generate more conflicts, but it will also accentuate the polarization that the ruling party seeks.
- For the sake of what is electorally speaking, one of the most consulted analysts, faithful disciple of the legendary “Manol It is clear that if they migrate they will go to the libertarian course but what is still in doubt, or, rather, what is not guaranteed is the magnitude of that migration. For him, PRO voters are in “Wait & See”, which is key to official electoral aspirations. The question continues to hover in itself the government’s permanent conflict strategy is sustained in the long term, that is, can four years govern in a situation of tension? The challenges were also analyzed, not only communicational, but of alliances in the interior of the country where Milei’s international policy matters little. On the PRO, he warned that the weakness of the Macri party is probably exaggerated regarding Lla.
- Meanwhile, the first post-veranos crosses among mesadineristas continue to focus on the exchange paw of the economic plan, which they consider key. Much wording about the next harvest and the rain effect, and it is necessary to say, about the negotiation with the IMF that continues to generate expectation and no concrete sign. For the most seasoned Boneros, the market has already “priced” the advances with the IMF and, obviously the payment to the bonds. Everyone looks if the BCRA accumulates or does not reserve, hence the prayers to heaven to rain, even though the energy sector plays in favor. And about the IMF, the only thing that matters is whether there is a new disbursement or not. For what was heard at the agency’s press conference with the accredited press, although the occasional outsider leaked, there is nothing new. The country risk is at the environment of the 550/650 points and the “hard” bonds depend on the fiscal balance and the accumulation of reserves, so they do not see much to win, no more than 10% in the long section, hence The biggest bets to the short section. The Portfolio Managers look at the maturities within the management of LLA, from there in more today they are risky bets. Some recommending ON to take advantage of something of the “carry trace” that remains after the decline of the craw and the BCRA rate, and inside the bond menu in pesos, the long stretch with CER see it more attractive.
- In a virtual exchange between the two shores of the Río de la Plata, men of the market gathered on a terrace of the City and colleagues in a reserved in José Ignacio spoke of the ranking of overvalued coins (adjusted to the GDP) of The Economist where the Argentine weight occupies The first place. On the appreciation of the weight it was opinion that it was not protected by an improvement in competitiveness, but by speculative operations of “Carry Trade”, so you had to remain very attentive for more than the Presi gets angry. One of the most veterans of the ESTEÑA table, with links in the IMF, recalled that artificially strengthening weight as an anchor to combat inflation was already a very busy path in Argentina, which historically ended in a default. According to the calculations that exchanged, this kind of descending beacon scheme of the nominality ensuring the “Carry”, continues long with an effective monthly rate in pesos of almost 2.5% and in dollars of almost 1.5%. It was weighted that the people of the “Toto” closed the month with a “rollover” rate of 96% and a net expansion of $ 0.4 billion, accumulating $ 4 billion since September 2024 that were financed with the weights that the treasure has in the BCRA product of the disarmament of paid liabilities. They estimate that, despite the last purchases of the BCRA, net reserves continue below the US $ 10,000 million, neuteing government deposits and Brepreal payments, according to echogue data that they contributed from the Buenos Aires terrace.
- The expectation of the market is that an agreement with the IMF decomposes the maturities with the international organism and others, and decomprints the transit to the elections with this exchange scheme. Hence, it is understood that the decision to lower the rhythm of the Crawling-PEG from 2% monthly to 1% and adjust the monetary policy rate to 2.4% cash monthly aim to want to anticipate less expected inflation in the coming months in the coming months and generate favorable conditions for the change market in order to align the incentives so that soy exports liquidations are strong before the mid -year elections, ensuring a more accelerated currency flow. Apparently in the bond market, one of the most expert diners explained that bond prices are reflecting implicit inflation of approximately 1.7% average monthly until December 2025, which implies that the market is already discounting A delay in the 8% exchange rate this year, which generates even more incentives to accelerate the currency offer in the short term and take advantage of the current context before a exchange adjustment is inevitable. As there is always an old Vizcacha, from the East a colleague jumped that pointed out that in 2024 there was only one country with a crawling-peg exchange policy: Bangladesh, and said that they do not want to know how the macro of that country is.
- Of which they talked well, it was about the vice of economy, the Chilean José Daza, who criticized his Chilean peers because he told them that, unlike Argentina, in Chile there were very few people who studied and know of formal finances, so he said That it was sure that it is not evil but ignorance and populism what they did with the pension reform. There was also talk of, the so -called Trump tariff that shakes the markets, in this regard, it was said that tariff threats against Canada and Mexico, although 30 days were delayed, have already disturbed the markets, and the repeated use of tariffs weakens the Influence of the United States, pushing Canada and Mexico towards commercial diversification. That is why North America’s supply chains face risks, the automotive, agricultural and energy sectors being the most exposed. On the coins, they commented that the depreciation of the peso and the Canadian dollar could expand the commercial deficit of the US, undermining the protectionist objectives; While the inflation driven by tariffs complicates monetary policy, pressing the Fed, Banxico and the Bank of Canada.
- At coffee time from City the host, he shared a riddle: do not know who I crossed walking down Florida Street? Before the general silence, the question answered saying that it was neither more nor less than to the so -called “Indiana Jones or godfather of emerging markets”, Mark Mobius himself. For the most distracted he had to explain that it was the legendary pioneer of emerging markets, an extempleton. And everyone knows that if Mark is, it’s because something happens. He told him that he visited Argentina again after many years and came to see, according to him, one of the most spectacular economic transformations in Argentine history, and for the first time in a long time, he perceived a genuine optimism that the country can finally be released of its crisis and stagnation cycle. This insightful investor, an emerging expert, pondered the advances and short -term results of the Milei government, but recognizes that there are still important obstacles to overcome. For Mobius, the greatest concern among investors is capital controls, they need to know that, if they put their money in Argentina, they can withdraw it when they need it. Therefore, he said that until these restrictions are raised, foreign capital will remain cautious.
- Also the issue of the exchange rate was present, and said it is another problem: the weight remains overvalued, what remains competitiveness to exports and makes it difficult for the central bank to accumulate the necessary reserves of dollars. Anyway, so as not to continue with the bad vibes, he considered that despite these challenges, Argentina is today one of the most interesting markets in the world, with a particularly promising energy sector, since the deregulation and opening of shale formations have Converted to the country into a key actor in world energy markets while financial services are also attracting investments, thanks to tax incentives and regulatory reforms; And, as inflation stabilizes, the retail retail sector is expected as consumption spending will rebound. Mobius already saw the economic roller coaster that Argentina has been living in recent decades. Today he sees real signals of change and although the challenges persist, the country is moving in a direction that, for once, seems different. Mobius left the talk in Florida to meet an old acquaintance, a former colleague of Franklin Templeton, Santiago Petri.
Source: Ambito
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