The country risk rises this Thursday due to third consecutive day. After reaching a floor of 914 on Monday, it could not stay at that level and rose day by day up to 978 points, 2.30% more than Wednesday.
This index, which measures the difference in rates between Argentine bonds and those of the United States, reflects the fall of dollar securities on Wall Street, that lose up to 1.30% this Thursday.
The reason? According to analysts, several reasons may be coming together. On the one hand, a profit taking after the rally that those same bonds experienced last week.
Secondly, according to Cohen’s traders, it seems that the market implemented the brokers’ saying of “Buy on rumor, sell on news” After the Government’s announcement, it acquired US$ 2.7 billion from the Central Bank to pay with own funds the capital of the securities that mature in January, a move “similar to the strategy implemented with interest.”
But there is another reading that maintains that the market It would not have been good for the Government to change its speech about where the funds were going to come from to pay. The thing is that, initially, it had emerged that the Ministry of Economy was negotiating a REPO loan with banks such as Santander and JP Morgan, to pay that maturity.
But now, Luis Caputo said that – although they are still in talks about the REPO to reinforce reserves – the payment will be made with funds from the current account.
“Due to the magnitude of the Argentine falls (in Tuesday’s bonds), we believe that local factors prevailed in a market that seems not having taken into account the advertisement purchase of dollars by the Ministry of Economy to ensure the January payment and/or to which the strategy changes or sequence added more noise than certainties,” they indicated in the consulting firm Outlier.