Overview
- On Friday the JP Morgan 'riesgo país' index climbed above 600 basis points, roughly a 50% rise from a July low near 402 and the highest reading in about five months.
- Higher U.S. Treasury yields raised external borrowing costs, but local forces — a sharp slowdown in central bank FX purchases and a 2.9% monthly drop in July activity (EMAE) — amplified the move.
- Dollar sovereign bonds fell strongly this week with long maturities hit hardest, Globales down about 2.9% on average and long bonds like AL35 yielding around 12%.
- Peso‑denominated instruments held up while equities slid, with the S&P Merval down roughly 3.5% in dollar terms as banks and capital‑intensive firms bore the brunt of the selloff.
- The higher risk premium sharply limits the Treasury’s room to tap international markets with new dollar issuances such as Bonares and raises the chance that the government must rely more on short‑term or peso funding.