5 de diciembre 2007 - 00:00

Dollar low curbed, BCRA buys $110 ML

BCRA head Martín Redrado
BCRA head Martín Redrado
Argentine debt bonds look like a weak-jaw boxer: any blow almost knocks them out. Yesterday, in view of US stocks low (Dow Jones lost 0.49 per cent in Wall Street), debt swap instruments plummeted as much as 4.5 per cent, while post-default ones dipped 2.40 per cent.

GDP coupons managed to endure the situation in a better manner, only sliding 0.43 per cent. However, GDP coupon in dollars lowered 2 per cent. The bond hit the most was Par in pesos by plunging 4.50 per cent. This bond is highly volatile and its sale price attracts the most courageous players. Transactions in this instrument are of quick entry and exit.

What's positive is that drop took place with poor trading. Between the Electronic Over-the-Counter Market (MAE, in its Spanish acronym) and Buenos Aires Stock Exchange, only ARG$1.2 billion was traded, 40 per cent less than last Friday.

Highly sought

Strong bond drop in New York, where Discount lost more than 2 per cent, like GDP coupon in dollars, caused Argentine country-risk to increase by 2 per cent to 416 basis points in JP Morgan EMBI+ index.

Post-default bonds in pesos endured widespread lows. BOCON PRE9 had the toughest time by sliding 2.40 per cent. Before intervention of Argentine Statistics and Census Institute (INDEC, in its Spanish acronym), this instrument was one of the most sought after BOGAR, which fell 1.70 per cent yesterday.

Post-default bonds in dollars also retreated. BODEN 2012, the most traded series, plummeted 1 per cent. On top of all that, interest rates in interbank market became stronger. For one day, as much as 9.50 per cent annual was paid, while, for seven days, 13 per cent.

Dollar in Argentina continued down. In Forex-MAE (main wholesale market), the American currency opened at ARG$3.1360. However, after midday, the only buyer was the head of Argentine Central Bank (BCRA, in its Spanish acronym), Martín Redrado. Dollar went as far as to touch ARG$3.1340, though it rallied by close to ARG$3.1360, after the monetary authority acquired $110 millions, raising reserves to $45.11 billions.

In exchange agencies, the American currency continues at ARG$3.16 for sale, because, in this retail market, a strong demand from the public is observed, who cannot find a place where to put their money and want to be protected from inflation. All the same, in some exchange agencies, it was offered at ARG$3.15.

Dollar shows a highly selling trend for today. Sale orders dominated market after close. Boards show $45 millions in offer and $15 millions in bid.

Bonds have lost in a day half of what they had recovered last week. For that reason, Retirement and Pension Funds Administrative Bureaus (AFJP, in its Spanish acronym) were highly active buying bonds, since prices are really low.

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