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Argentina: how recent events shape the investment outlook

8/23/19,  by Amundi

  • Recent update on Argentina: Government’s decision to freeze energy prices and suspend VAT on certain products will complicate fiscal metrics. The country is likely to miss the IMF target of a primary balance for 2019. However, the IMF could disburse the September tranche of financial assistance, although conviction levels are low.
  • Credit rating downgrade: As expected, markets reacted negatively to this news. The focus now would be on government’s ability to roll over short-term USD and Argentina Peso (ARS) denominated loans.
  • Markets in the coming weeks: A bounce in asset prices could be seen as an opportunity to lighten further exposure to Argentina. Markets will now focus on the roll-over ratio of short-dated government debt in the country. Elsewhere, investors will closely watch the US-China rhetoric, comments from the Fed Chairman at Jackson Hole and global growth data.

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Amundi is the European largest asset manager by assets under management1 and ranks in the top 10 globally[1]. It manages 1,563 billion[2] euros of assets across six main investment hubs[3]. Amundi offers its clients in Europe, Asia-Pacific, the Middle East and the Americas a wealth of market expertise and a full range of capabilities across the active, passive and real assets investment universes. Clients also have access to a complete set of services and tools. Headquartered in Paris, Amundi was listed in November 2015.

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Footnotes

 

  1. ^ Source IPE “Top 400 asset managers” published in June 2019 and based on AUM as of end December 2018
  2. ^ Amundi figures as of September 30, 2019
  3. ^ Investment hubs: Boston, Dublin, London, Milan, Paris and Tokyo

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