The Government overcame one of the most difficult tests of the year by renewing 96% of a mega maturing debt in pesos for $14.6 billion that threatened to add pressure on the dollar. The result was encouraged by the drop in bank reserves and an increase in certain ratesin a context that had raised doubts regarding the Treasury’s ability to refinance the debt without tensions.
During the auction, the Ministry of Economy awarded $13.99 billion out of a total of $14.68 billion offered. According to official data, among the most demanded instruments Fixed-rate bonds and inflation-adjusted bonds (CER) stood out.. The BONCAP maturing in February 2026 was the one with the greatest volume, with $3.7 trillion awarded to a annual rate of 37.55%, above the expected 20.6% inflation in the next 12 months, according to the latest market survey (REM) of the BCRA.
From Economy they highlighted the “reduction of real rates” with respect to the previous tender in the CER section of up to 215 basis points, the extension of the average life of the portfolio and the deindexation of the Treasury portfolio by the unwinding of hedging of instruments tied to the exchange rate.
But analysts noted that the Government had to undo some of the monetary squeeze and offer incentives to investors. “It wasn’t bad, it was demanding, they did several things to make it easier for them: the reduction of short rates last week was aimed at this tender to encourage everything to go longer. They also changed reserve requirements regulations. And now they raised the rate a little in the tender, a premium of less than 100 basis points, 1%, but it is not insignificant, they paid above the market“said Gabriel Caamaño, director of Outlier.
The shift towards CER and fixed rate instruments was accompanied by a Marked drop in appetite for bonds linked to the official dollar. One of the dollar linked series was deserted and in another the renewal was minimal, in a context of disarmament of post-election coverage.
“There were placement rates a little higher than they were in high school, which was generous with the rate. The rollover was close to 96%, which was one thing the market was following closely. There was a relatively large maturity and almost everything with the private sector, and a rotation towards fixed rates and inflation,” said Pedro Siaba Serrate, head of research at PPI.
Along these lines, the title adjusted for price variations expires in May 2026 and achieved $1.19 trillion with an annual rate of 7.34% above inflation, while the zero coupon as of October 2026 awarded $446,824 million at 7.79%.
In the previous, The Central Bank eased the reserve requirement burdenallowing banks to integrate a greater proportion with public securities, which freed up resources to go to bidding. In addition, the Treasury offered a yield somewhat above the secondary market in several papers, especially those adjusted for inflationwhich came with low traded volume.
“The amount of pesos they absorbed through fixed rate instruments is interesting; the demand for these assets is fundamental for the monetary financial program in the coming months. With respect to inflation-indexed placements, The treasury gave a prize because at these prices it is convenient for Finance to go into debt in CER if inflation falls as they expect“said Lucio Garay Gómez, EcoGo analyst.
There was also demand for the TAMAR bill (rate tied to wholesale fixed terms) in April 2026, with $2.7 trillion with a margin of 4% over the monetary policy rate. And an interest marked by the LECAP capitalizable bills, with a term until April 2026, which was placed at an annual rate of 35.16%, and another valid until October 2026, at 34.27%.
In this framework, economist Federico Machado appreciated that the government has achieved almost 100% of the rollover. “It was a very challenging tender, the government was wise enough to relax reserve requirements. I thought it could get complicated for them, and no: they were able to roll everything over, extend terms and maintain rates at good levels,” he said.
The placement was one of the biggest. On November 5, Finance had awarded $8.5 billion, and on October 29, $6.8 billion, below the almost $14 billion raised this Wednesday. Unlike those rounds, the auction made it possible to push maturities towards 2026 and 2027, which improves the Treasury’s amortization profile.
The downside is the highest financial cost in some instruments, as a result of the prize offered to ensure renewal. After this result, there are only a few remaining maturities in the 2025 schedule and the heavy load is transferred from 2026.