From Reuters: Argentina avoids Trump uncertainty with bond sale, finmin tells paper

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Jan 22 Argentina shielded itself from potential market volatility after the election of U.S. President Donald Trump by selling a more-than-expected $7 billion in bonds on Thursday, Finance Minister Luis Caputo said in an interview published in the Clarin newspaper.

The sale of five- and ten-year bonds likely means Argentina will not need to sell additional dollar bonds this year, he said upon returning from a road show to promote the bond sale.

“With these funds we have saved ourselves from the uncertainty of the so-called Trump effect,” said Caputo, who had said $3 billion to $5 billion would be sold in dollar bonds.

“In principal there will not be new emissions. There could still be something in yen, euros or Swiss francs or another emission in dollars in order to settle an expiration but the stock of dollar bonds will not grow.”

The bonds sold on Thursday were more than three times oversubscribed, with total orders for some $22 billion. Caputo said that Argentina did not sell more than the $7 billion to maintain market credibility.

“Credibility is at stake. If we took $12 billion we could have aroused suspicions and the investors could have been against us,” he said in the interview on Saturday. “In addition, if complications appear in the rest of the year we have scope to obtain those funds.”

Caputo said that total issuance in 2017 would be half those of 2016, when the federal government sold $20 billion, provinces sold $7 billion and companies around $5 billion.

“This year the federal government will emit just $7 billion, the provinces no more than $3.5 billion and companies at most the same as last year,” he told Clarin.

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