News summary – Argentine non-stock bonds jumped 1.6% on Friday amid growing optimism about the eventual debt restructuring deal, as the government prepares to host a technical mission to the International Monetary Fund next week, traders said.
According to the JPMorgan Emerging Markets Index for Emerging Markets, the margins of risk on Argentine bonds are narrowed compared to US Treasury securities, which are still a safe haven after the bond market crash last year.
Argentina is in talks to restructure about $ 100 billion of sovereign debt, including with the International Monetary Fund, which provided $ 57 billion in credit facilities to the South American country in 2018, the largest fund ever.
Center-left president Alberto Fernandez, who came to power last December, has targeted an agreement with creditors by the end of March, a deadline that is ambitious but also a sign that the government wants to avoid default.
The country’s sovereign bonds and Buenos Aires thrived in the country this week with positive signs, including “a meeting between Economy Minister Martin Guzman and International Monetary Fund President Kristalina Georgieva at the Vatican, which both called for construction.”
The Buenos Aires Province government also avoided defaulting 2021 when it agreed to pay $ 277 million after it failed to obtain bondholders ’approval to repay it until May.
Graham Stock, senior sovereign strategist at Asset Management Bluebay in London, pointed to the ends that the country was on the verge of concluding a deal with the IMF, which would be a major step towards launching the debt crisis.
“But a lot of detail must be put on these bones and on their economic plans, but things this week have been encouraging,” he said.
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