GOVERNMENT CONFIDENCE FELL TO ITS LOWEST LEVEL OF THE ADMINISTRATION, and marked a session of sharp risk aversion in the local market, in a global backdrop that offered no relief either. Dollar sovereigns retreated, with the long end hit hardest, and country risk rose. At the auction, the Treasury rolled over everything that matured, paying a premium and without extending tenors. The peso curve eased in the long tenors, the exchange rate rose slightly, and the Merval plunged.
THE TREASURY ROLLED OVER ALL MATURITIES, paying a premium and without extending tenors. It awarded ARS 8.62 trillion against maturities of ARS 8.61 trillion, a rollover rate of 100.1%, and validated rates above the secondary market, especially in CER and TAMAR. For the fourth consecutive auction, it did not offer peso-denominated bonds maturing in 2028 or later, so as not to validate rates on that tenor. As a result, everything awarded matures before December 2027, with a weighted average tenor of 5.8 months. In October, ARS 26.9 trillion comes due, with the heaviest pressure at month-end from the D30O6, which already totals USD 5,348 M, the largest dollar-linked maturity of the year.
DOLLAR BONDS FELL 0.7% ON AVERAGE, in a session of lower global risk appetite in which emerging market debt retreated 0.9%. Globales lost 0.8% and Bonares 0.7%. Under New York law, the short end closed practically unchanged, with declines concentrated in the longer tenors, which fell as much as 1.7%. Under local law, the decline was more even across the curve, with drops of up to 1.3%. Country risk rose 19 bps to close at 628 bps. Meanwhile, Bopreal bonds measured in MEP dollars advanced 0.2%.
PESO CURVES ENDED MIXED IN USD TERMS, with a clear tenor-based skew in line with the auction outcome. Dual CER-to-TAMAR bonds were the laggards, down 0.3% in USD terms. They were followed by TAMAR (flat), dollar-linked (+0.1%) and fixed rate (+0.2%), while CER bonds gained 0.3% in USD terms. The short end held firm and the long end drove the moves: CER short tenors rose 0.6% and long tenors gained 0.1% in USD terms, while fixed-rate long tenors ended flat and short tenors rose 0.3% in USD terms. Overnight rates rose: the one-day caución closed at 20.8% NAR (+0.3 pp) and the repo rate at 20.7% NAR (+0.2 pp).
THE OFFICIAL EXCHANGE RATE ROSE 0.3%, to close at ARS 1,528.8, bringing its September gain to 1.3%. The MEP dollar advanced 0.2% to ARS 1,555.2, while the CCL dollar fell 0.3% to ARS 1,613.7 and the gap narrowed to 3.8%. Meanwhile, the BCRA bought USD 11 M during the session, bringing its September total to USD 243 M and its year-to-date total to USD 14,350 M. Gross reserves, meanwhile, fell USD 269 M to close at USD 47,976 M.
THE MERVAL PLUNGED 3.3% IN BOTH PESO AND CCL TERMS, closing at USD 1,725. Selling was widespread and no sector ended higher. Construction, energy and materials fell the least, while consumer staples, communications and industrials lagged. On the local panel, Loma Negra (flat), YPF (-1.3%) and Pampa Energía (-1.6%) fell the least in USD terms. The biggest decliners were Transportadora Gas del Norte (-6.8%), Telecom (-6.5%) and Cresud (-6.3%) in USD terms. In New York, ADRs fell 3.0% on average. Only Corporación América rose (+9.1%), and Loma Negra (-0.4%) and Vista (-0.8%) were among those that fell the least. Central Puerto (-8.4%), Telecom (-7.2%) and Cresud (-6.1%) posted the worst declines.
TORCUATO DI TELLA UNIVERSITY PUBLISHED SEPTEMBER'S GOVERNMENT CONFIDENCE INDEX, which fell 5.9% m/m to a reading of 38.8%. It is the lowest of the Milei administration, matching the levels of September 2025 and July 2026. Year-to-date it has dropped 21.4%, concentrated between January and May. In month 33 of the administration, it remains above Mauricio Macri (35.0%) and Alberto Fernández (24.6%) at the same stage. The administration's average, however, fell to its lowest reading (46.8%, versus 49.4% for Macri and 37.2% for Fernández over the same span). All five components declined, with the drop concentrated in the interior of the country.
