Merval Grinds Higher as Peso Holds at 1,520

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Merval Grinds Higher as Peso Holds at 1,520

MERVAL2,896,853.00+0.95%

USD/ARS1,520.25+0.00%

EUR/ARS1,708.37+0.18%

Gold4,146.20-0.98%

Market Snapshot

Asset	Level	Change
MERVAL	2,896,853.00	+0.95%
USD/ARS	1,520.25	+0.00%
EUR/ARS	1,708.37	+0.18%
Gold	4,146.20	-0.98%
Brent Crude	101.54	+0.95%
Soybean	1,305.75	+0.21%
Bitcoin	83,896.88	-1.94%
Argentina 10Y	-	-

Prior Economic Events

Data	Prior	Cons	Actual
No events available

Today's Economic Events

Data	Prior	Cons	Time
No events available

Merval gains 0.95% to 2,896,853 while USD/ARS holds steady at 1,520.25
Milei advances foreign-ownership liberalisation; Falklands oil policy outlined
Brent near $101.54 supports energy terms of trade; soybeans firm at 1,305.75

Yesterday's Recap

Argentine equities ground higher on Tuesday, with the Merval adding 0.95% to close at 2,896,853.00, extending the domestic rally even as global risk appetite softened. The peso was the picture of stability, with USD/ARS unchanged at 1,520.25, suggesting the managed-band regime and BCRA's accumulation strategy continue to anchor the currency. Crossed rates told a slightly different story: EUR/ARS rose 0.18% to 1,708.37, hinting at modest dollar softness against the euro rather than any ARS-specific strength.

Commodity moves were constructive for the external accounts — Brent crude climbed 0.95% to $101.54, buoying Vaca Muerta-linked revenue prospects, while soybeans ticked up 0.21% to 1,305.75, supporting the export-led dollar inflow pipeline that underpins reserve accumulation. Gold fell 0.98% to $4,146.20 as the safe-haven bid cooled, and Bitcoin dropped 1.94% to $83,896.88, a reminder that high-beta assets remain vulnerable even as Argentine equities decouple. No official statistics were released, leaving the market session as the day's main event.

The Day Ahead

The calendar is quiet, with no scheduled statistical releases or policy announcements on the domestic docket. Attention shifts to secondary market dynamics: desks will watch whether the Merval's grind higher pulls provincial and corporate paper along with it, and whether the peso's stability at 1,520 attracts carry flows into short-dated instruments. BCRA operations — repos, Leliq rollovers, and any communication on monetary aggregates — will be scrutinised for signals on the pace of peso liability management.

Internationally, the IMF's October World Economic Outlook cycle is approaching, which historically frames programme reviews and any adjustments to reserve targets. Traders should also monitor follow-through on foreign-investment measures, following Foreign Minister Pablo Quirno's comments on Falklands offshore oil policy, for implications for energy sector sentiment. With no domestic prints, global rates and commodity direction will dominate the tape.

Other Economic Notes

President Milei's push to remove restrictions on foreign ownership of land and natural resources is generating domestic political friction, with protesters citing 'foreignisation' concerns in rural provinces — a tension worth monitoring as the administration courts foreign investors. ↓ p.2

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Other Economic Notes (continued)

The latest verified inflation print stands at 33.5% year-on-year as of August, a level that, while dramatically lower than the 2024 peak, still constrains the BCRA's ability to cut aggressively without reigniting expectations. Fiscal consolidation remains the anchor of the programme, with the primary surplus target serving as the credibility foundation for the disinflation glidepath. The soybean export window and energy self-sufficiency trajectory are the twin structural stories underpinning the current account improvement.

Global Macro News

Global central banks are in a tightening-or-holding mood, a backdrop that raises the bar for emerging market carry trades including Argentina. India's central bank delivered a surprise 25bp hike to 5.50%, its first since 2023, citing Middle East conflict-driven inflation — a reminder that energy pass-through is live globally with Brent above $100. The Bank of England's Catherine Mann flagged that high UK inflation is now 'embedded', while Sweden's Riksbank kept a hike in play amid sticky inflation, and South Africa's central bank warned of rising second-round inflation effects.

The Philippine peso weakened to 62.771 against the dollar, and Nigeria's naira slipped to about 1,331 per dollar, illustrating broad EM currency pressure that Argentina's stable 1,520 print contrasts with. The World Bank upgraded Thailand's GDP forecast on AI-linked export strength, and the FTSE 100 opened lower alongside bonds, suggesting a risk-off tilt that Argentina's idiosyncratic rally is currently resisting.

Continuation

BCRA Watch

The central bank has been notably quiet on the communication front this week, with no new policy statements or rate decisions — consistent with the post-programme phase where the monetary policy rate has receded as the primary tool in favour of the crawling peg and reserve accumulation targets. The stability of USD/ARS at 1,520.25 suggests the band mechanism is operating as designed, with the BCRA likely intervening only at the edges. With CPI at 33.5% year-on-year and decelerating, the real rate calculus is becoming less restrictive in effective terms, giving the BCRA room to let the crawling peg do the disinflationary work.

Watch for any guidance on Leliq and peso liability stock reduction — the pace of that unwinding is the key remaining lever for money demand recovery. The next meaningful communication will likely come with weekly monetary data, where the market will parse base money expansion against the fiscal anchor. Any signal on the timeline for full capital account liberalisation would be a major catalyst for the bond complex.

Argentina Macro Daily(Beta Mode)