Country risk exceeds one thousand points but the stock market is recomposed

EMBI (the emerging markets bond indicator) is calculated by JP Morgan and this is the main indicator of country risk, measures the difference between the interest rate paid by emerging market bonds and US Treasury bonds, which are considered the safest.

This indicator expresses market uncertainty about the country's ability to have sufficient resources to meet its external debt commitments. This shows the confidence you have in the economy of a country and establishes the interest that will be paid to grant you a loan.

What does it look like in the graph, country risk continues to grow and exceeds 1,000 basis points. Friday has already reached 985 full at the close and this Monday, and advance of ten units, at 996 basis points. If we exceed 1,012 points, we will find ourselves in the same situation as in 2014, when the decision was taken in favor of vulture funds and that the markets badumed that Argentina could not resume their debt .

In concrete, this index establishes how much more a country is charged with giving a loan. With a level of 1,000, Argentina must pay 10% more interest on a loan than US Treasury bonds.

International context

Part of this growth comes with the announcement of US President Donald Trump, who has promised to impose tariffs on Mexican imports. A new front that accumulates tensions in a scenario of commercial war, the United States closing more and more their doors.

"At the global level, capitals are hiding in safe securities and currencies because of the difficulty of anticipating the outcome of the conflict between the United States and China. and the fear of a major drag on global growth, "said the Foundation for the Mediterranean in a report.

He added that "at the local level, we are witnessing a deterioration of the international situation but especially of increased uncertainty for the day after December 10 (when the elected president takes office) ".

Although we should keep in mind that Current levels have remained after the high debt load of the Argentine economy since 2016, which deepened last year after the agreement with the IMF and raises doubts about the ability to pay it.