.svg){kind=small}
.svg){kind=small}
.jpeg)
ON MONDAY'S SESSION, LOCAL ASSETS HAD A POSITIVE DAY. Sovereign dollar bonds edged higher and country risk broke below the 500 bps mark. In the peso curves, Lecaps, CER, and Duals advanced, while dollar-linked instruments declined. Financial exchange rates retreated, while the official exchange rate rose. The BCRA purchased over USD 100M in the official market and added to gross reserves. Meanwhile, the Treasury announced the terms of Wednesday's auction. Additionally, Buenos Aires City's April CPI was released, showing a deceleration from the prior month.
THE TREASURY RELEASED THE TERMS OF WEDNESDAY'S AUCTION, which faces maturities of ARS 9.4 trillion, concentrated mainly in the Lecer X15Y6. The offered basket includes a fixed-rate instrument (S30S6), two Boncers (TZXY7 and TZXS7 – new), reopens the CER/TAMAR Duals (TXMJ8 and TXMJ9), and a dollar-linked instrument (D30S6). It also reopens Bonar AO27 and AO28 bonds with a maximum placement of USD 250M per instrument across the first and second rounds. The reopening and new issuance of long-dated instruments suggests the Treasury would continue its strategy of extending maturities to ease its debt profile, taking advantage of the system's ample liquidity.
DOLLAR-DENOMINATED BONDS CLOSED ON A CONSTRUCTIVE NOTE, outperforming emerging market debt. Globals rose 0.3%, with the GD46 leading the curve with a gain of 1.9%, while the GD29 was the exception with a decline of 0.9%. Bonars closed virtually unchanged, with the AL29 as the best performer in the local-law curve (+0.6%) and limited losses in the rest. With this performance, country risk compressed 17 basis points and closed at 496 bps. Bopreal Series 4 advanced around 0.6%, while the rest of the curve traded without significant changes.
ARS-DENOMINATED DEBT HAD A POSITIVE SESSION, led by CER bonds, which rose 0.9%. Both the fixed-rate curve and Duals posted gains of 0.7%, while dollar-linked instruments edged up 0.2%.
THE OFFICIAL EXCHANGE RATE ADVANCED 0.4% and closed at ARS 1,399.47, trading 23.2% below the upper band of ARS 1,723.55. The MEP dollar retreated 0.4% to ARS 1,419.65, while the financial dollar declined 0.6% to ARS 1,477.96, bringing the financial dollar-to-official spread to 5.6% and the MEP-financial dollar spread to 4.1%. The BCRA purchased USD 136M during the session, accumulating USD 466M in May and USD 7,621M year-to-date. Gross reserves rose by USD 87M and closed at USD 46,143M.
THE MERVAL OUTPERFORMED LATAM AND BRAZIL EQUITY INDICES, rising 2.3% in pesos and 3.0% in dollar terms, closing at USD 1,917. The rally was driven mainly by energy and banks, while materials, construction, and real estate traded lower. In the local panel, YPF (+6.4%), Banco Galicia (+4.6%), and Banco BBVA Argentina (+4.7%) led the gainers, while Transener (-3.6%), Banco de Valores (-2.8%), and Holcim (-2.3%) posted the steepest declines. Among ADRs, the average rose 2.0%, with Bioceres (+15.5%), YPF (+6.0%), and BBVA (+4.9%) as the top performers, while Globant (-5.1%), MercadoLibre (-4.6%), and Telecom Argentina (-2.2%) led the declines.
BUENOS AIRES CITY PUBLISHED ITS APRIL CPI YESTERDAY, showing a monthly increase of 2.5% m/m (32.4% y/y), decelerating from 3.0% m/m in March and bringing the year-to-date figure through April to 11.6%. Breaking down by component, regulated prices led with 3.3% m/m — driven mainly by fuel, private health insurance, water, and bus fares — seasonal items rose 1.8% m/m, while core inflation came in at 2.3% m/m, below the headline. We estimate that the national CPI, to be released this Thursday, would come in around 2.7% m/m.
