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Argentina Offers Local-Law Dollar Bond to Test Market Before January Maturities

Economy Minister Luis Caputo targets about $1 billion at a cost below 9% to help cover $4.2 billion due on January 9.

Overview

  • The Bonar2029N is payable in dollars under Argentine law, carries a 6.5% coupon, and matures in 2029.
  • Market estimates point to an effective yield closer to 10.7%–11.5% with below-par pricing, above the government’s stated goal.
  • Regulators authorized insurers to use dollar collateral to participate in the sale, capped at 20% of their public debt holdings.
  • The operation is the first local dollar issuance in roughly eight years, and early market reaction showed little change in country risk.
  • Officials frame the placement as a gauge of refinancing capacity, with additional funding options such as bank repo lines under consideration.