A horizon with fewer reserves drives bonds and increases country risk again

The Country Risk Argentina climbed again on Tuesday despite the downtrend dollar in the city of Buenos Aires, around 3% on Mondays and 0.2% on Tuesdays.

It is true that the The central bank managed to circumvent the restriction lend the foreign currency by the International Monetary Fund (IMF) and, in agreement with the organization, regained attribution to participate on the forex market, but for investment funds, the use of these dollars grind the future ability to pay of Argentina, in a scenario of financial instability and with the imminence of presidential elections.

On the other hand The IMF is a privileged creditorwith which Argentina has always met the deadlines, even in the case of the breach between December 2001 and February 2005. Therefore, the private creditors watch the news with great caution announced for the foreign exchange market because in case of lack of dollars to pay the debt, the organizations will have priority multilateral

The JP Morgan indicator for Argentina raised 952 basis points, with an advance of 13 whole or 1.4% in the day. Around the age of 15, he scored 959 whole numbers.

Argentine country risk has reached a intraday record in just over five years of 1,011 points last Thursday. At the same time, Friday the 26th ended at 963 basis points. These maximum ranges range from 1,018 units on February 5, 2014.

For the economist Gustavo Ber, stabilizing country risk in the current range is "a moderate reaction since you use reserves to intervene deteriorate available reserves to meet commitments debt in case the external voluntary credit remains closed ".

"Yet the biggest firmness is always concentrated in the shortest titles before buying from official agencies that would seek to take advantage of the parity reduction and the yields of the order of 18%"annual dollars," said the owner of Estudio Ber.

Public securities in dollars with Argentine legislation remain the most depressed in terms of price, with firm rates of return such as the case of the Bonar 2020 (17.5%), Bonar 2024 (18.2%) and Bonar 2025 (18.1%).

The sovereign bonds of the Mercado Abierto Electrónico (MAE) were also rearranged at the end of the month and showed a average decrease of 0.5%informed Reuters.

According to a report by Morgan Stanley, the The announcement of the BCRA was positiveas exchange rate volatility is expected to decrease and relative stability would help improve the dynamics of inflation and prospects for the future, which have a positive impact on the weak growth of the economy.

Analysts of Search for traders explained that sovereign bonds issued in dollars operating abroad "were disappearing take off from the minimum recorded the previous week, "explaining that the JP Morgan indicator had dropped 1,000 basis points.

They added that "this happened in a setting in which BCRA can intervene on the foreign exchange market to reduce market volatility. In addition, they helped ANSeS purchases short titles the duration, according to market sources. "