2024-08-23 13:51:00
After government’s setback in Congress, Markets are starting to end a week that saw the government take two big blows in Congress, This appears to have caused concern among some industry players that Javier Milley’s government will be unable to push through pending reforms.
As some analysts explain, These last few rounds of the market have reflected a cautious attitude towards investment. The opposition joined forces with the PRO to overturn the decree on the special management of funds of the State Intelligence Secretariat (SIDE).
This comes ahead of a vote in the upper house yesterday (Thursday) on plans to increase pensions, with Javier Milei’s government quickly promising to reject the plan outright because it would harm the fiscal balance. “LSenate vote on incendiary measure means debt rises by $370 billion” the president said in a televised statement on Friday.
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Javier Mire and the economic team support the veto of the retirement reform: “Casta, I’m here to touch the fiscal balance”
“In Argentina Political noise will weigh on bonds and stocks Just like he always does,” he assured Purfield. Rick Gaston Lentini, Also add The retirement law and its veto will have consequences. “Let’s think about it, If the country spends more, it has fewer opportunities to repay its debt, so its bond prices are likely to fall.“Said the strategist.
“This situation will be on the agenda again cWhen Congress tried to approve the law Unlike the first half of the year, which actively managed their seats, delaying the release of the Basic Law due to a lack of management is a hallmark of the opposition’s strategy.
In his analysis, “The breakout that seemed to occur in April at the beginning of the year is now occurring in October. When we have hard data on how many people are involved in money laundering,maybe nRIGI New Investment Announcement Having just come under regulation, as well as the removal of the definition of state tax, although the elimination of stocks will obviously be left until next year, legislation may be considered,” he stressed.
Lentini also mentioned that the final interest rates in the United States will have an impact on the domestic economy. “On an international level, this could give us volatility as most markets await the news we hope to hear in April: interest rates will fall,” the analyst said.
In terms of North American rates, The biggest question in the market is whether the Fed will cut interest rates by a quarter or half a percentage point.and whether it might be the only one in 2024.
What happened in Thursday’s round
In the round on August 23, Argentina’s Wall Street-listed stocks (ADRs) fell as much as 6.3%, bonds in U.S. dollars fell nearly 3%, and the country risk index hit a new high in more than two weeks (1,560 points). In the local market, the BYMA S&P Merval Index fell 2.7% to 1,577,419.84 points.
For one financial analyst, “Markets are once again questioning Milei’s governance.”
in this Against a backdrop of political weakness, international reserve conditions also added to market doubts The provisions of the BCRA directly affect the value of bonds. For example, US dollar government bonds fell as much as 2.7% yesterday, with Global 2041 having the largest decline, followed by Global 2046 (-2.6%) and Global 2035 (-1.6%).
This Friday the 23rd is another litmus test for the market, which must deal with the impact of the president’s veto of the new retirement package voted on by the Senate.
Under development…
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