Political Risk Latin America Blog @PolRiskLatam

Argentine Bonds Head to Worst Slide Since May: Argentina Credit

Posted in News and Articles by politicalrisklatam on August 27, 2010

by Ben Bain and Tal Barak Harif for Bloomberg Business Week, August 27th, 2010.

Aug. 27 (Bloomberg) — Argentine bonds are headed to their biggest two-week slump in three months as a slowing global economy and growing clash between the government and the country’s largest newspaper erode demand for the securities.

The average yield that investors demand to hold Argentine dollar bonds instead of U.S. Treasuries has climbed 82 basis points, or 0.82 percentage point, this week to 776, according to JPMorgan Chase & Co. The gap has widened 106 basis points since Aug. 13, the biggest two-week surge since May, while the average spread on emerging-market debt over Treasuries rose 20.

The South American country’s bonds are underperforming after President Cristina Fernandez de Kirchner asked a court this week to review the 1976 purchase of a newsprint producer by Grupo Clarin SA, a move opposition leaders say is an attempt to silence critics in the media. The bond decline, which snapped a six-week rally, the longest in four months, has also been sparked by concern that a faltering global expansion will erode demand for the country’s wheat, corn and soybean exports.

“The selloff is partly related to fears of a double dip, fears of slower economic growth globally,” Jim Craige, who helps manage $12 billion of emerging-market debt at Stone Harbor Investment Partners, said in a telephone interview in New York. The Argentine government’s actions “definitely have contributed” to the decline, he said. (continue reading… )

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2 Responses

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  1. miguel said, on August 28, 2010 at 7:38 pm

    The Argentina of 5% of income for the average or invest much more, Puerto Madero and northern Buenos Aires Province is an important and profitable, some consultants in the U.S. and UK seems of no use to invest in this country but they are wrong many an investment and have moved to this country for their levels of living and quality consultants offer a highly implausible vision, but many americans are moving here, it’s good for us, the level of investment is not large but people with money to invest are flooding this country, these consultants only take large-scale investments.

    • politicalrisklatam said, on October 4, 2010 at 2:31 pm

      Miguel, thanks for your comment!


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