ARGENTINA: Return To International Markets Seen This Year, Economic Activity Due
May-21 12:27
- Speaking in a local TV interview yesterday evening, President Milei said that the government can continue to reduce taxes, as long as the economy continues to grow. He also said that the country is nearing the point where it can regain access to international markets.
- His comments on the latter were echoed by Economy Minister Caputo who, speaking at a separate business event, said that he is optimistic on returning to markets this year. Caputo said that this would be used to refinance capital payments, as the government has enough of a budget surplus to make interest payments on its debt.
- Separately, Caputo said that the government would cut tariffs on some industrial goods to the Mercosur threshold of 12.6%. Currently, tariffs on these goods range from 20-35%.
- On the data front, economic activity is expected to have risen by 6.5% y/y in March, following a 5.7% gain previously (2000BST/1500ET). However, Goldman Sachs notes that high frequency indicators portend a soft activity print, owing to headwinds from increased uncertainty and volatility ahead of the new IMF programme announcement.
- March Economic Activity Index YoY, est. 6.5%, prior 5.7%
- March Economic Activity Index, MoM prior 0.8%
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STIR: Repo Reference Rates
Apr-21 12:11
- Secured Overnight Financing Rate (SOFR): 4.32% (+0.01), volume: $2.505T
- Broad General Collateral Rate (BGCR): 4.31% (+0.01), volume: $1.047T
- Tri-Party General Collateral Rate (TCR): 4.31% (+0.01), volume: $1.016T
- (rate, volume levels reflect prior session)
US TSY OPTIONS: Early Treasury Option Roundup
Apr-21 11:56
Mixed Treasury option flow gradually picking up ahead the NY open, light overnight trade with Europe closed for Easter Monday. Underlying futures extending lows, curves twisting steeper with short end resisting sell-off, 2s10s +9.053 at 61.299. Despite this morning's sell-off, projected rate hike pricing gain slightly vs. Thursday levels (*) as follows: May'25 at -3.4bp (-2.7bp), Jun'25 at -19.0bp (-17.6bp), Jul'25 at -40.1bp (-38.6bp), Sep'25 -59.9bp (-57.4bp).
- Treasury Options:
- 4,000 TYK5 109.5/111 put spds vs. 111/111.5 call spds ref 110-30
- 2,000 TYK5 110.75/111.5 strangles 30 ref 110-29.5
- 1,500 FVM5 108.5/109 call spds, 14.5 ref 108-16.5
- over 7,400 TYM5 114 calls, 14 last
- over 6,000 TYK5 110.75 puts 18 last
- over 9,900 TYK5 110 puts, partly tied to 109/110 2x1 put spds
- 2,500 wk2 TY 112 calls ref 111-06
US TSY FUTURES: Extending Lows
Apr-21 11:11
- Futures extending lows again, sellers meet limited buy interest, low overall volumes volumes at Jun'25 10Y trades down to 110-30 (-7.5), total volume just over 151k. 10Y yield climbs to 4.3676% (+.0427).
- Initial Technical support below at 110-15/109-08 (Low Apr 15 / 11 and the bear trigger); Continued weakness would refocus attention on 109-08, the Apr 11 low. A break of this level would resume the downtrend.
