Bond auction: government is offered double with 119% interest rate

The Economy Ministry faced maturities for AR$283 billion pesos and investors offered nearly AR$600 billion


The Economy Ministry secured AR$332.5 billion in its bond auction on Friday in a round where it faced maturities for AR$283 billion. In a tweet, Finance Secretary Eduardo Setti said that offers were made for some AR$600 billion. 

“We want to thank the strong backing of the market in this new auction for the financing of the public sector,” Setti said.

Today, the government held a second round of the auction for brokers that belong to the Market Creator program. According to the Economy Ministry, an extra AR$13 billion were allocated.

The net positive balance for February was AR$184 billion, and AR$403 billion for all of 2023 – a 139% roll over rate for the year.

The bonds offered on Friday were a LELITE that matures at the end of March, two Ledes (S31Y3 and S30J3), the X16J3 Lecer and the T2V3 dollar-linked bond.

Contrary to the previous auction, most of the financing — 54% — came from the Ledes, that is, fixed-rate instruments.

However, only 19% of what was offered to the X16J3 inflation-adjusted Lecer was accepted. This, according to the broker SBS, shows there is a “strong appetite” for inflation-fixed instruments. 

The S31Y3 Lede had a 119% effective annual rate, roughly 1 percentage point higher than the previous round, where the Lede has a 118.1% effective annual rate. The S30J3’s effective annual rate was 119.5%. With a 98.8% annual inflation rate, the rates remained positive by more than 20 points, not counting the crawling peg, that is, the peso depreciation against the US dollar, which was 5.5% in January.

The next bond auction is scheduled for March 22.


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