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Home / argentina / Caution due to government debt has returned, and the country's risk has reached 700 basis points

Caution due to government debt has returned, and the country's risk has reached 700 basis points



irons rulers in dollars turned this week before a profit after picking up from the beginning of this year.

Profitability, which goes against the price, is stabilized for the EU. T dollar emission, with Argentine and New York legislation, in a they range between 10 and 11.7 percent per year in the central part of the curve.

Country risk JP Morgan, who measures the difference in American bond rates with emerging peers, arrived in the afternoon 701 base points for Argentina, to move away from the minimum in 2019, the entire 664 last January, January 24th. At the closing of the operation, the indicator has dropped off 688 units, after the president of the US Federal Reserve, Jerome Powell, will say that the North American central bank be patient when it comes to raising the price of money this year, faced with growing uncertainty about the US's economic prospects.

Although in 2019 the country's risk in Argentina deprive more than 100 base points, finds in the last wheels resistance to go back

"That's what's out of existence." factors that play in support developing countries and, consequently, Argentina, and offering Argentinean titles more interesting return compared to other countries uncertainty about the election presidential elections in October are again present, "the report states Research for traders.

S a rate of 2,695% for a ten-year US Treasury bond, Argentina remains far from the ability to issue public debt on international markets, where it should offer yields close to 10% per annum in dollars to convince the investment funds.

The still high JP Morgan index for Argentina appears in a the context falls the price of sovereign bonds of countries emerging, which is affected by the approaches to debt sustainability towards. t current account and fiscal dynamics, two weak hips when a debate on the domestic economy is conducted.

Experts Balanz Capital stated that " inflation, especially in countries such as Argentina, a factor changes the path of reducing the country's risk in the long term, which is generally underestimated. "

"We believe that structural decline in inflation rate." proviso not only reduce local capital costs but also enable developing countries increase the share of debt in the local currency in calculating total gross debt, "Balanza said.

Unlike Argentina, whose government debt in local currency does not reach 20% of the total number, Turkey has 59% of its liabilities in installments; Brazil has 78% of its gross domestic debt in GDP and. t Mexico Mexican pesos have 63.8% of total public debt.

"By contrast, T Argentine debt denominated in dollars represents 83% of the total state debt in force, which implies a potentially unpleasant catalyst for a chronic devaluation addict with a small share of GDP exports, "Balanz's analysis stressed.


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