THE LOCAL MARKET OPENED THE WEEK WITHOUT CLEAR DIRECTION, with attention on Wednesday's auction, for which the Treasury announced a broad menu that includes a new TAMAR dollar-linked dual bond. Dollar sovereigns traded mixed, and country risk eased back toward 440 bps. Peso curves were little changed in USD terms, with CER and dollar-linked notes roughly in line with the rest once adjusted. On the FX front, the official rate and financial dollars rose, in a session of thin central bank buying that left reserves practically stable. On the macro front, the Government confidence index for July declined, in line with the deterioration consumer confidence had already shown last week.
THE TREASURY ANNOUNCED TERMS FOR WEDNESDAY JULY 29'S AUCTION, in which it faces maturities of roughly $8.5 trillion and close to USD 2,250 M in dollar-linked debt. The menu combines a new LECAP/BONCAP due 10/16/26 (S16O6), a CER/TAMAR instrument due 12/15/28 (TXMD8), two dollar-linked notes due 9/30/26 (D30S6) and 1/15/27 (D15E7, new), and a hard-dollar reopening of the AO29 (10/31/29). The novelty is a new TAMAR dollar-linked dual bond due 1/28/28 (TMVE8), broadening the FX-hedging offer.
DOLLAR BONDS CLOSED MIXED, with hard-dollar debt edging up just 0.1% on average. Globals rose 0.3% while Bonares slipped 0.1%, with markedly different behavior across curves and segments. Within Globals the long end led, headed by GD30 and GD46 with gains near 0.5%, while in Bonares the long segment lagged, with AL41 and AL35 falling around 0.4% and only AL30 in positive territory. Country risk added 2 bps to 439 bps. Bopreal notes ended with no relevant changes, with mixed moves across strips.
PESO CURVES WERE LITTLE CHANGED IN USD TERMS, in an even-toned session. CER and dollar-linked notes, nominally in the lead with gains near 0.1% in pesos, were roughly flat to slightly lower once translated to USD, closely trailed by fixed-rate paper, while duals and TAMAR-linked instruments slipped marginally in USD terms after ending unchanged in pesos. Within the fixed-rate segment the move was contained, with longer Lecap and Boncap issues performing somewhat better than shorter ones, in a slight negative steepening of the curve.
THE OFFICIAL EXCHANGE RATE ROSE 0.3% TO $1,498.5, bringing its month-to-date gain to 1.0%. In the financial segment, the MEP dollar advanced 0.2% to $1,530.8 and the CCL dollar 0.2% to $1,601.0, with the CCL-official gap around 6.8% and the MEP-CCL spread at 4.6%. Separately, the central bank bought USD 27 M on the day, bringing accumulated purchases to USD 1,964 M in July and USD 13,138 M year-to-date. Meanwhile, gross reserves fell USD 18 M to close at USD 49,165 M.
THE GOVERNMENT CONFIDENCE INDEX (ICG) FELL TO 1.94 POINTS IN JULY, a 6.5% decline from the prior month. In month 31 of the administration, the level stood 3.9% below Mauricio Macri's reading and 73.3% above Alberto Fernández's at the same stage. The pullback was expected after the consumer confidence index had already shown a decline last week, amid a broader deterioration in expectations.
