DISINFLATION IS TAKING HOLD AND THE BCRA BOUGHT HEAVILY, in a session that combined a fresh disinflation signal with positioning ahead of the Treasury auction. June CPI decelerated again, marking three straight months of moderation. Peso debt traded mixed, with CER debt firm and dollar-linked bonds outperforming as the exchange rate fell, while sovereign dollar debt closed slightly higher and equities were mixed. Separately, the official rate and financial dollars fell while the BCRA bought heavily again. Today the Treasury holds an auction whose maturities are not a significant challenge.
THE TREASURY HOLDS THE FIRST AUCTION OF THE MONTH TODAY, facing maturities of $3 trillion. The menu includes a November Lecap (S30N6), a March 2028 Boncer (TZXM8) and an August 2028 TAMAR bond (TMG28), along with dollar-linked bonds due August 2026 (D31G6) and December 2028 (TZVD8) and a new May 2027 bond (TZVY7). In hard dollar, it offers the AO29 due October 2029, with a 6% monthly coupon and a USD 250 M cap in the first round, with a second round at the cutoff price on Thursday, capped at a combined USD 400 M face value. The Treasury holds $7.2 trillion in its BCRA account, though the stock of pesos the BCRA absorbs via repo has been declining, suggesting somewhat less slack than in recent weeks. It will likely roll over above its maturities, though with a tighter margin.
PESO CURVES TRADED NEUTRAL, in a session dominated by the inflation print, which came in line with market expectations. CER debt rose 1.5% and Lecaps were essentially flat, up 1.4%, as were Duals, also up 1.4%. Dollar-linked bonds were the exception, rising 0.6%. On peso rates, the one-day repo (caucion) closed at 20% NAR, down from 25.4% in the prior session.
DOLLAR BONDS CLOSED SLIGHTLY HIGHER, with the hard-dollar index up 0.3%. Globales rose 0.4% and Bonares 0.2%, in a mixed session where the GD30 (+0.8%) and AE38 (+0.6%) led while the GD46 (-1.3%) lagged, tracking a broader rally in emerging-market debt. Country risk was little changed at around 408 bps. Bopreales edged down 0.1%.
THE OFFICIAL EXCHANGE RATE FELL 0.8%, closing at $1,474.74, accumulating a 0.6% decline in July. The MEP fell 1.7% to $1,498.02 and the CCL fell 1.4% to $1,544.66, with the FX spread at 3.1%. Separately, the BCRA bought USD 532 M on the day, accumulating USD 1,103 M in July and USD 12,277 M so far this year; with agricultural settlements at normal levels, the amount likely reflects corporate bond settlements. Gross reserves rose USD 482 M, closing at USD 48,687 M.
THE MERVAL ROSE 0.5% IN DOLLAR TERMS (down 0.2% in pesos), closing at USD 2,075, in a mixed session. By sector, Real Estate (+1.3%), Communications (+1.1%) and Energy (+0.9%) led the gains, while Financials (-1.4%) and Non-Essential Consumer (-1.2%) lagged. Among local stocks, Sociedad Comercial del Plata (+2.9%), TGN (+2.2%) and Mirgor (+2.2%) led the gains, while Holcim (-2.2%), BYMA (-1.6%) and Banco Galicia (-1.4%) posted the biggest declines. ADRs listed in New York rose 0.9% on average, led by TGS (+3.1%), Telecom (+2.8%) and Bioceres (+2.6%), while Globant (-3.7%) and Galicia (-1.2%) led the declines.
JUNE CPI DECELERATED TO 1.9% M/M, two tenths below May’s 2.1%, marking three consecutive months of moderation; the first half of the year totals 16.8% and the year-on-year reading closed at 33.5%. Seasonal items led the increase at 3.4% m/m on vegetables and package tours, regulated prices rose 2.3% m/m on electricity and public transport, and core inflation came in at 1.6% m/m, contributing most to the moderation. Recreation and culture posted the largest increase at 4.2% m/m, followed by housing, water, electricity, gas and other fuels at 3.3% m/m, while health (2.9%) and alcoholic beverages and tobacco (2.1%) also outpaced the general average. At the other end, clothing and footwear (0.4%) and communications (0.9%) posted the smallest increases, and services again outran goods, 2.9% m/m versus 1.4% m/m.
