Country risk exceeds 1,600 points, the highest in four months, as the decline in financial dollars continues.

Argentina’s financial market showed a downward trend on Tuesday, although less pronounced than on Monday, but at the same time the decline in alternative dollar quotes continues.

A significant sell-off in stock assets pushed the country’s risk to its highest level in four months after the government Javier Miley will announce measures on Saturday aimed at getting the free dollar back on track amid a weakened economy.

Bonds traded with losses for the second day, although stocks began to recover, and the dollar continued to correct downwards on alternative exchanges

This Tuesday dollar-denominated sovereign bonds fell more than 1%according to Globals’ guide to foreign law on Wall Street. At the same time, country of risk JP Morgan up 34 units for Argentina 1,590 basis points at 3:50pm after hitting high 1608 basis points at middaymaximum since March 14.

Index S&P Merval Buenos Aires Stock Exchange Starts with a Decline 5%, but just an hour after closing it rose by 1.4% to 1,526,000 points..

“The government is putting forward more and more conditions for exchange rate liberalization – the elimination of remunerated monetary obligations, puts with banks, inflation converging with the rate of devaluation, a low exchange rate gap and an agreement with the IMF that provides more reserves – but it does not logically set a time frame,” the clearing agent said in a report. Cohen.

On Monday, the Merval stock index in Buenos Aires fell 12.3% in pesos and 4.1% in dollars, according to the “cash with liquidity” measure. “The stock market in particular is historic, one of the worst falls in many years, with all kinds of precautions being taken,” he said. Reuters stockbroker.

“On the surface, the short-term framework suggests a narrowing of the currency gap, an improvement in fixed-rate peso debt and a reduced appetite for currency and inflation-hedging strategies,” he said. Personal portfolio investments.

“In the case of dollar debt, we believe the analysis is somewhat more complex. A priori, the new scheme promises to undermine reserve accumulation in the coming months. The relationship between said accumulation and implicit default probabilities suggests that Argentine bondholders attach importance to this indicator,” he noted.

The government announced over the weekend that it would stop expanding its monetary base as part of the government’s policy to combat inflation after it announced central bank consolidation through the issuance of fiscal letters (LeFI) to channel bank liquidity to the detriment of the Treasury.

“What was announced can only be seen as positive if the gap narrows significantly in the coming days and inflation falls sharply in the coming months,” the clearing agent said. Nayx.

“We believe that the decline in the peso supply could be accompanied by an increase in the interest rate. If this were to happen, the real rate would be positive in the short term, which is already observed in the CER curve (inflation-adjusted bonds) for 2025 and beyond,” he said.

Minister of Economy Louis Caputo He reported this on his social media account.

In turn, the president’s press secretary Manuel Adorninoted that “the deepening of the monetary program will contribute to the deflation process (and that) according to BCRA estimates, it will be necessary to absorb about 2.5 trillion pesos in addition to what will be absorbed through the primary surplus.”

“The reduction of the inflation tax will help to narrow the gap, which, in turn, will contribute to the orderly elimination of currency restrictions,” he noted.

In a further attempt to reassure investors, the government announced that it would continue to buy from BCRA the foreign currency needed to pay the combined interest on the Globales and Bonares bonds due in January 2025.

“We see this decision as more aimed at containing expectations of a widening of the currency gap, given that, as we have already noted, the BCRA is a seasonal net seller in the MULC in the second half of each year. That is, in principle, we do not expect too much expansion of the peso due to foreign currency purchases in these months,” the minister said. SBS Group.