EM LATAM CREDIT: Argentina: Nov. Inflation Higher Than Expected – Negative

(ARGENT; Caa1/CCC/CCC+)

• Argentina CPI was expected to be up 2.3% MoM and instead rose 2.5%. The YoY rate ticked up to 31.4% compared to a consensus expectation of 31.2%. Core inflation increased 2.6% and regulated prices were up 2.9% according to Bloomberg, so there was nothing to justify the report as an aberration.
• ARGENT 35s were quoted at $71.29, a yield of 10.48%, which was down .43 today but up 4 points since June 30th. Market focus is on seeing if the government can get the 2026 budget passed by congress, getting more details on how the government will refinance upcoming debt maturities and successful passage of tax and labor reforms.
• The 2026 budget reportedly will assume 10% inflation and the IMF projected earlier this year that inflation would fall to 20-25% by end of 2025. Last week’s BCRA analyst survey projected 19.6% inflation for 2026 while Bloomberg forecasted 25% for 2026 and said after this data, they saw upside risks to what was already above Street consensus.