Argentina Long Duration Bonds Offer Best Risk-Reward: Balanz
(Bloomberg) -- Long duration sovereign bonds due 2046, 2117 and Argentine-law discount bond due 2033 are top picks, Balanz analysts led by Walter Stoeppelwerth write in note.
- For carry traders, Balanz recommends Province of Buenos Aires bond due 2022, Province of Mendoza bond due 2021 and discount bond in pesos
- "Treasury Ministry has $7.7b in greenbacks stockpiled and grain farmers are believed to hold US$12bn- US$13bn in inventories, limiting dislocation risk"
- "The ARS will be volatile, so investors need to exercise discipline on entry points," adds note
- Following recent market downdraft on ARS and fixed income, thematic focus shifting to Argentina’s growth momentum and "the salubrious knock-on effects that this rebound could have on asset prices"
- Potential for real salary growth to around 5% y/y by August should help underpin economic recovery
To contact the reporter on this story: Carolina Millan in Buenos Aires at cmillanronch@bloomberg.net To contact the editors responsible for this story: Arie Shapira at ashapira3@bloomberg.net Cyntia Barrera Diaz
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