12/07/13 Create PDF Report File | BancTrust & Co.
Argentina weekly report Nº 40 - July 12 2013
Racing Toward October BancTrust & Co. Reseach Team [email protected] The government faces a significant challenge +582129038400
banctrust.com Key pollsters show Sergio Massa ahead, but… BTCO
First polls show Kirchnerism loosing Buenos Aires Province and the City by significant margins. Two different polls award former Kirchner-ally Sergio Massa a 10ppt lead over Martín Insaurralde, who is leading FPV (Kircherism)’s ticket in the Buenos Aires Province for the upcoming legislative elections. With open primaries being held in August (the actual election will take place on 27 October), Massa had 33.7% and was followed by Insaurralde with 22.8% support according to a poll conducted by Poliarquia. Importantly, the Poliarquia study highlighted that 37% of respondents said would vote for the government’s candidate but a large proportion (45%) fail to pick Insaurralde.
The obvious conclusion is that Insaurralde is still a relatively unknown candidate and that Massa –who defected Kirchnerism- is still being identified with the administration (Massa not only was Executive Director of Social Security Agency ANSeS but he was later on appointed Chief of Staff by President Kirchner, a position he held until June 2009). The other poll - conducted by Management & Fit- award Massa a 35.1% voting intention with Insaurralde following suit with 25.2% support levels. In the City of Buenos Aires district, Gabriela Michetti – Macri’s candidate for the Upper House- has a voting intention that would top 36.6% compared to 19.5% of FPV’s Daniel Filmus. On another note, as regards the race for Congressmen in the Federal district, Elisa Carrió seems the best-positioned candidate to win her own party’s nomination (UNEN) as well as the election in October.
In a simulation having her as UNEN candidate, voting intentions for Carrio stand at 29.2% compared to 20% for PRO’s candidate Sergio Bergman. Juan Cabandie, the government’s candidat(See attached file: charts.xlsx.zip)e, came in third place with 15%.
Higher rates? Think twice… Issuer of Venezuela Weekly Report:BancTrust Servicios Higher seasonal demand due to the Winter holidays and the payment of the mid-year Financieros Sucursal mandatory bonus placed some pressure on FX dynamics. Thus, after several weeks of Venezuela, C.A.(Venezuela) stability at around ARS8.0/USD, the parallel exchange rate gained traction and was traded at around ARS8.20/USD, notwithstanding renewed moral suasion applied by Trade Secretary Moreno on FX brokers. So far, the government’s strategy to quench depreciation pressures until after the October election –inspired in chávez-nomics- has been effective through a combination of dollar bond sales, some use of FX reserves and higher interest rates. As a This report must be read with its matter of fact, interest rates on ARS CDs are currently hovering around 18.5%, a level closer respective disclaimer on page 3 to running inflation. 1
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BancTrust & Co. July 12 2013
Higher inflation in June, but still contained According to the Congress CPI (an average of private estimates that cannot be released due to a ban of Trade Secretary Moreno), CPI inflation reached 1.9% m-o-m in June which took annual inflation to 24%, up from 23.4% y-o-y in May. Inflation is still below the level recorded in end-2012 (25.6% y-o-y). Even though the scope of However, this strategy is once again inconsistent with the price agreements has become more limited as from late, we government’s electoral objectives that would command keeping believe that the government will continue to fine-tune inflation financing costs as low as