This Monday, Finance Secretary Pablo Quirno announced a new bond tender: “The Ministry of Finance announces a tender for this Wednesday, May 28 with a maximum amount to be covered equivalent to the maturities of May 30 plus the payments of coupons and amortizations in pesos made last week that amount to total at $ 8.55 billion.”
Finance will leave on Wednesday with an issue of up to US $ 1 billion that are subscribed in dollars, without going through the single and free market (Mulc), but whose expiration is paid in pesos. The bonus will include a put (sale option) to two years, coinciding with the rest of the mandate of Milei, and is designed exclusively for international investors.
The investor may demand the repurchase of the bonus by the treasure within two years at a default price or formula specified in the issuance. Thus, it gives an “exit insurance” or “change” to the investor before the executive elections of 2027, and not wait for the expiration in May 2030.
This is the “Bonte”, a bonus in pesos with the intention of taking dollar debt in what will be the first experiment of this style since 2018, when Caputo was under the command of Economics during the Macri government. Thus, Caputo and Milei bet on Carry Trade from the outside, which he had been announcing a few days ago.
Last week the Central Bank, through communication “A” 8245, had enabled not residents to participate in primary (direct) tenders subscribing in foreign currency titles in the pesos of the national treasure, provided that the debt has a period of more than 180 days to avoid speculative rapid outputs.
“Important! Argentina once again gains access to international markets, to refinance debt capital in local currency. Something that the vast majority of countries do normally, but that for Argentina was not possible, given the economic collapse inherited. Product of it, it was that last year the central bank could accumulate only a lower percentage of the record purchases of dollars it made in the market, since it had to pay not only the interests, but also the capital of the debt expires. Wrote the Minister of Economy, Luis Caputo, on Network X.
He added: “It is important to highlight that this operation does not imply an increase in gross debt, nor net. Only an increase in the level of BCRA dollars and a significant extension of the duration of the debt in local currency.” Again the minister denying the indebtedness.
Caputo had announced last week that he expected to return “this year” to international debt markets, but also recognized the high levels of country risk. The index that JP Morgan prepares is almost double (close to 700 points) of the 360 points with which Caputo went to the markets for the last time in January 2018, paying a rate of up to 6.95%.
The fund policy, the exchange anchor and the problem of reserves
The International Monetary Fund put as a goal of accumulation of 5,000 million reservations that must be gathered before June 13, according to the new agreement. The government faces a problem since since the “uprising” of the stocks, the BCRA did not buy dollars. Thus seeks to cover the mattress of reservations taking new debt, rolling the previous one, and not intervening in the Mulc to avoid an inflationary trigger. The cost, a debt snowball.
The Bonte is one of the instruments that the Ministry of Finance will offer on Wednesday to cover the equivalent to the maturities of May 30 plus the payments of coupons and amortizations in pesos made last week, which ascend in their entirety to $ 8.55 billion. Lecap will also tend until November 2025, Boncap until May 2026 and CuPón Zero Bonce until October 2026.
According to the Clarín newspaper, from Wall Street they considered the announcement of finance as “pure marketing” because it is a local law bonus and because it pays the investor in pesos. “The main characteristics of” returning to the international market “are two: New York Law and Payment in Hard Currency, that is, dollars or euros,” they said in a fund that operates in the United States bags.
The necessary sovereign rejection of debt
The left is the only political sector that openly raises the impossible need to reject the covenant with the IMF, to end the scourge that means for social majorities to live under the boot of this organism. The IMF returned 7 years ago, by the hand of Mauricio Macri, he was legitimized in Congress in 2022 by Peronism, and this new program of extended facilities guarantees at least 10 more years.
Specifically, this translates into the continuity of spending adjustment, which is lower silver for health, education, public works, tariffs in services (light, gas, transport, water), layoffs of public employees. Continue sinking retirement and pensions, which since the IMF returned lost 50 % purchase power. But it also gives free way to a new wave of privatizations of public companies and structural reforms. And the delivery of natural goods considered strategic to US companies, such as lithium.
In addition to the sovereign rejection of the debt fraud, the nationalization of the banking system and foreign trade under workers administration, are complementary measures that would allow the great escape of capital and speculative maneuvers, which feed the devaluation expectations. In addition, cheap credits could be generated for small trade and the working people and care for national savings. These measures are part of an approach that kicks the board for a background exit, to start planning the economy from below, depending on the needs of the great majorities and not of the profits.
Faced with the economic crisis that continues to accelerate, it is also necessary to demand an emergency increase for wages and retirement. No salary should be less than the basic family basket and no retirement can be behind the retiree basket. The union leadership has been complicit in this salary attack and retirement, it is necessary to impose a struggle plan until ending this adjustment plan, a general political strike, the only means to defeat the set of the government adjustment plan, the IMF and the great business.
Source: www.laizquierdadiario.com
