Country risk plummeted by more than 180 points following the Treasury's support announcement

Country risk dropped by more than 100 points following the Treasury's support announcement

porEditorial Team

Argentina

Sovereign bonds also reacted to the USD 20 billion assistance package promoted by the U.S. Treasury

Argentina's country risk registered a sharp drop this Wednesday following the announcement by the United States Secretary of the Treasury, Scott Bessent, regarding a financial support package aimed at strengthening the Central Bank's reserves and stabilizing the markets.

The news triggered an immediate plunge of 180 units in the indicator, which fell to 839 basis points, after having remained on the rise just minutes earlier.

The immediate effect on the market

El riesgo país se desplomó más de 100 puntos tras el anuncio de apoyo del Tesoro

The change in trend occurred after it was confirmed that Washington is negotiating a USD 20 billion swap with Argentina, the purchase of bonds, and stand-by loans as part of a comprehensive support scheme. The market's reaction was swift: country risk, which had risen 5 points before the announcement, reversed sharply and broke through the 1,000-point floor.

Meanwhile, global sovereign bonds replied with widespread gains:

The news triggered an immediate plunge of 180 units in the indicator, which fell to 839 basis points, after having remained on the rise just minutes earlier.

The immediate effect on the market

Meanwhile, global sovereign bonds replied with widespread gains:

Global 2029: +2.22%
Global 2030: +2.80%
Global 2035: +5.01%
Global 2038: +3.79%
Global 2041: +3.35%
Global 2046: +2.92%

The impact of U.S. support

Estados Unidos negocia un swap de USD 20.000 millones con Argentina

The proposal presented by Bessent included three central pillars:

Negotiation of a USD 20 billion swap line with the Central Bank of the Argentine Republic (BCRA).
Possibility of bond purchases in dollars by the United States Treasury.
Granting of a stand-by loan through the Exchange Stabilization Fund.

This package of measures is part of Washington's strategy to support the government of Javier Milei and ensure a solid financial front amid electoral and currency volatility.

A signal to the market

The official announcement not only impacted asset prices and the risk premium, but also reinforced investors' expectations regarding the continuity of economic reforms.

For local market analysts, the magnitude of U.S. support opens a window of opportunity to accelerate the stabilization process and consolidate confidence in Argentina's financial markets.

Country risk plummeted by more than 180 points following the Treasury's support announcement

The immediate effect on the market

Country risk plummeted by more than 180 points following the Treasury's support announcement

The immediate effect on the market

The impact of U.S. support

A signal to the market

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