The consolidation of the financial program of the government of Javier Milei has reached a new milestone this week with the successful placement of the new dollar bond, the Bonar 2029 (AO29). The Ministry of Economy managed to capture massive interest from domestic investors, securing the necessary financing to honor the country's commitments without resorting to the monetary issuance characteristic of Kirchnerism.
Specifically, the Secretariat of Finance closed this Thursday the second round of the auction of the AO29, awarding a total of USD 150 million. These figures, combined with the USD 470 million obtained on Wednesday, raise the total financing achieved through this instrument to USD 620 million.
The operation was carried out at a Nominal Annual Rate (TNA) of 7.99%, achieving the official goal of staying below the 8% barrier, a cost significantly lower than what the international market would currently demand.
The success of the day was based on an audacious strategy led by Minister Luis Caputo. Unlike previous issuances such as the Bonar 2027 (AO27) and the Bonar 2028 (AO28), the Government decided to eliminate the placement cap in the first auction to absorb the liquidity from the recent payment of maturities of USD 4.2 billion.
In this regard, Minister Caputo explained: “This is because many people, once they receive the coupon, try to reinvest it; as we are paying USD 4.2 billion in this placement, we say: 'We won't set a limit of USD 150 million' because maybe there are more people who want to reinvest it and it could be a slightly larger placement”.
For his part, the Secretary of Finance, Federico Furiase, reinforced this view by stating that the measure aimed to “take advantage of the payment of the maturity and, obviously, there we can have more demand eventually due to the payment of the bond”. In this second round, offers were received for a total of USD 276 million, of which the mentioned USD 150 million were awarded.
