The Ministry of Economy swapped AR$9 billion ($146mn) of the Dual Bond for securities nominated in pesos at a private Badlar rate plus surcharge with maturity on August 5, 2021. It also obtained AR$3.6 billion through the tender of Lebad letters with maturity on May 28 and August 28. Argentina decided to postpone to Sept. 30 the payment of the AF20 dual bond that matured on Feb. 13 after restructuring negotiations with the majority of bondholders failed.
The average income of Argentine workers has slumped by 44.3% in dollar terms since 2015, according to a report by the Universidad Nacional de Avellaneda (Undav). This was predominantly due to the peso’s heavy devaluation and real wage lag during the last four years. The decline was even sharper when measuring the purchasing-power of the minimum wage, which passed from representing $589 at the end of 2015 (AR$5,588 at that time) to the current $268 (AR$16,875 pesos) – a plunge of almost 55% in only four years.
The net formation of external assets of Argentine residents, known as ‘capital flight’, was $60 million in January, the lowest level in almost a decade, according to the last exchange balance of the Central Bank (BCRA). The ‘services’ account registered a currency outflow of $26 million, a sharp reduction compared to $686 million in the same month of 2019. Argentina capital flight broke the historical record in 2018 with an outflow of $27.3 billion that year.
Argentine bond prices fell 1.3% on Thursday after an IMF technical mission essentially gave the government a green light to restructure about $100 billion in bonds and loans, including $44 billion owed to the IMF. Argentine bond prices are down 4.8% so far this year. Country risk spreads 11EMJ stood 82 basis points wider at 2,117 over safe-haven U.S. Treasury paper, indicating an increase in the perceived likelihood of default.
Argentina-based e-commerce platform MercadoLibre will invest $420 million this year in Mexico, its fastest-growing market, up 46% from 2019. The company will focus its spending in Mexico on logistics, financial services and expanding its brands and products, said MercadoLibre’s Mexico chief executive, David Geisen. MercadoLibre’s net revenue in Mexico jumped 152% last year to $275 million