The former Argentine representative to the International Monetary Fund, Héctor Torres, expressed his concern about the issuance of a Decree of Necessity and Urgency (DNU) aimed at advancing an agreement with the IMF and the official statement that this will result in a reduction of public debt. Torres indicated in a radio interview that he finds it unusual for the Government to present a DNU without specifying the terms of the agreement with the Fund.
"It is not normal for the Government to send a DNU whose agreement is unknown," Torres pointed out, adding that there is a contradiction in the official statements. Torres noted that the assertion that there will be fresh funds while the debt with the IMF is reduced raises uncertainties. In this regard, he suggested that the claim that the debt will not increase with the loan is a well-known argument in this context.
Furthermore, Torres assessed that the issuance of the DNU will not lead to an increase in the value of Argentine bonds. According to his analysis, any rebound in bond prices would not be directly related to the DNU, but rather would be a result of the fact that following a decline, Argentine bonds would be at low prices, creating a potential rebound in the market.
