Public securities show a deepening of the decline, although somewhat more moderate than that of the previous round. This Wednesday they reversed a slight initial rise and at 12:20 hours they registered a 0.2% average drop for Global bonds.
These bonds in dollars with foreign law are the reference for Argentine debt abroad and in some cases, such as the GD35 and GD46 are traded below USD 30, a minimum price since its listing in September 2020.
In the same vein, the risk country of Argentina renews its maximums since the sovereign restructuring, in the 1,819 points basic, with a jump of 22 units in the day.
The JP Morgan indicator, which measures the rate of return gap of US Treasuries with their emerging peers, touched a recent low of 1,101 points basic on September 10 of last year, immediately after the completion of the debt swap with private creditors.
Since then, Argentina’s country risk has grown by more than 700 basis points, which implies that if the Government tried to place bonds abroad in these circumstances, should pay annual rates of 20% in dollars to obtain acceptance in the voluntary debt market, before US Treasury bonds that in their ten-year issues pay an annual income of 1.67%.
As for the securities in dollars with local law, the situation is similar. While the Globals of the short tranche already yield over 23% annually, the Bonar 2030 (AL30) yields 24% and Bonar 2029 (AL39) yields 26% annual.
For the experts of Research for Traders, “The prices of the securities issued in September of last year remain depressed and are trading at minimum values since the restructuring. And this generates a high implicit probability of default”.
“A agreement with the IMF is key, since it will clarify how the economic course will be in the next two years. The announcement of the dispatch of a bill with a multi-year economic program agreed with the IMF staff did not finish convincing investors, who are still concerned about the concrete progress of said plan, “they added from Research for Traders.
Investors await more details on the multi-year program that the Government will present in December in Congress to be debated
“Argentine bonds do not find a floor. The debt market is concentrated in the short term and the challenges of the macro in the coming weeks. The electoral result did not dispel uncertainty economically and the combo of recent months is repeated: an agreement with the IMF pending, monetary noise and exchange rate pressures negatively influence the markets. The lack of economic measures to correct the current imbalances affects the performance of the debt ”, indicated the experts of Personal Investments Portfolio.
“We see that the areas with greater tensions in the face of an agreement with the IMF will be the path of fiscal consolidation and the role of rates of interest. In the case of exchange controls, it is possible that a progressive dismantling of exchange restrictions will be agreed upon, once Argentina can sustainably recover international reserves ”, commented the consulting firm Delphos Investment in a report.