The government of Javier Milei entered June with a general adverse financial climate in the market: increase in parallel quotes of the dollarthe exchange gap, fall in bonds and stocks and rise in the risk country. In the Executive Branch they maintain that the tensions are explained more by negative political signals, in particular, by the delays in the approval of the Base Law and the tax package which also precipitated the departure of the now former Chief of Staff, Nicolas Posse.
The official vision, as he was able to reconstruct Infobae in different consultations with official sources, is that there should be no alarm in the face of a BCRA that buys foreign currency and the maintenance of the fiscal surplus goal of the Minister of Economy, Luis Caputo. Furthermore, they consider the market’s reading of the possibility of having to face the payments of the swap with China with reservations.
The Buenos Aires stock market opened this Tuesday with a sharp drop in the first deals in the framework of a global market that operates in decline due to doubts about the economy of USA. Local sovereign bonds fell by up to 3.6% and pushed the country risk up by 4% until it was close to 1,500 points. There was an advance of more than 2% in all parallel quotes of the dollar, with the free exchange rate (“blue”) returning to $1,265 for sale.
Local market analysts have focused their attention in the last few hours on the continued delay of the ruling party’s projects that the Senate will discuss next week, but that if successful they will not have a prompt sanction. In the almost six months of management, the Government failed to pass any law through Congress.
The lack of favorable political signals for the ruling party in parliament raised concerns among investors. The exchange market showed volatility and the Central Bank slowed down the pace of foreign currency purchases, in a quarter in which the strong inflow of foreign currency from the harvest begins. Another issue that the market looks at with special attention is the currency swap schedule with China, in weeks in which the first maturities of the tranches used a year ago begin to operate. USD 2.9 billion expire at the end of this month and USD 1.9 billion at the beginning of July, for the tranches that Sergio Massa used last year for debt payments and imports. There are almost USD 5,000 million in yuan that the Asian giant will have to refinance or that will have to come out of reserves.
Infobae He consulted different areas of the Government to find out what their interpretation was of a scenario that became unfavorable. The official view rejects that investors begin to sell national assets due to a change in expectations and that the macro fundamentals did not experience changes that justify it. The economic team reiterates that the roadmap to achieve the fiscal surplus is maintained, the positive trade and current account balance continues and that there is a shortage of pesos due to the “blender” effect. They also do not see the BCRA’s rate reduction as the culprit of the instability.
That is why the Executive points to a more political explanation but with economic implications: the delay in the approval of the Bases Law and the failed May Pact. They had responded to the same argument in the face of the tensions in the markets that occurred in the last week of May, prior to Posse’s resignation. The one designated as the new Chief of Staff, Guillermo Francos, negotiated the ruling for the ruling party in the Senate but the truth is that for now there is no agreement to advance in the sanction of the regulations.
On the other hand, in the economic area of the Government they consider that the market’s reading of the swap is “wrong.” They affirm that the president of the BCRA Santiago Bausili continues with negotiations with the People’s Bank of China to refinance upcoming maturities. This implies, in case of success, not having to use reserves to meet the USD 5,000 million in capital.
“There is no doubt that the drivers The main one is the future of the Base Law and the fiscal package. Although their approval is expected next week in the Senate and ratification by Deputies in July, the comments made by the protagonists will have an impact on the mood of investors,” Portfolio Personal Inversiones (PPI) analyzed in its report. diary.
“What happens with the swap with China will also be fundamental, since it could cost the Government 5,000 million dollars in disbursements if it fails to roll over the debt,” he stated (PPI).
Analysts kept an eye on the results obtained by the BCRA in the exchange market. Of the USD 17,777 million in imports in the first quarter, only USD 8,509 million were paid, less than half. The rest, USD 9,268 million, increased the commercial debt with the private sector due to the current payment quotation scheme. In the same period, the entity purchased USD 11,101 million in the market, that is, almost everything was explained by the postponement of payments abroad.
One of the most relevant expressions of investor concerns can be seen in the peso debt market, where the Government and the Central Bank play one of their most important games on the way to eliminating the remunerated liabilities of the monetary authority and their migration to papers issued by the Treasury.
Market operators marked the rise of the Boncer 2026 (TX26), a title that adjusts for inflation, as a sign that a more negative expectation for the general price level is beginning to be incorporated. “Repressed inflation laid bare is this. They know that June is above May,” said a trader to Infobae.
Conversely, fixed rate bills Lecap In the longer term, they suffered declines that were based on the same investor pessimism. “The Lecap as of March is a massacre, it already yields 4.1% of the monthly effective rate when it was below 3.5%,” said the same specialist. Debt securities rates move inversely to prices: when they fall, yields rise.
