BUENOS AIRES (Dow Jones)-Argentina’s pension fund agency, Anses, trimmed its holdings of government securities in June compared with the previous month.
Anses’s investments in public-sector debt fell 0.2% on the month to 106.5 billion pesos ($25.3 billion) at the end of June, but rose 14.2% on the year, the agency said Thursday in its monthly report on assets under management.
The U.S. dollar-denominated Bonar X bond showed the biggest decline as a percentage of the agency’s government bond portfolio, falling to 7.9% from 8.5% at the end of May. The agency’s holdings of dollar-denominated Boden 2015 bonds was steady at 3.4% of the total.
Anses and the Central Bank of Argentina regularly intervene in the local foreign exchange market to stabilize the peso amid growing levels of capital flight in an election year.
Local traders say Anses has taken a bigger role in the foreign exchange market in recent months, selling and buying bonds to take some of the pressure off the central bank, which has seen its reserves fall as it defends the peso.
President Cristina Kirchner is trying to avoid abrupt moves in the exchange rate that would spook voters as she seeks reelection in October. Kirchner is widely expected to win a second term after receiving just over 50% of the vote in Argentina’s first open primary election in August.
But investors are speculating that Kirchner will allow the peso to depreciate at a swifter rate after the elections to help exporters, who have seen their competitiveness eroded by high inflation at home.
The peso was quoted closing on the local MAE foreign-exchange wholesale market at ARS4.2045 to the dollar Thursday, unchanged for the fourth straight session. The peso has depreciated about 5.4% versus the dollar so far this year.
Barclays economist Sebastian Vargas wrote in a report Thursday that he expects Anses to play a key role in helping the government to cover an estimated financing gap of $6.4 billion in 2012.
«In its role of underwriter of treasury debt, we continue to expect Anses to tap markets for $5 billion to $6 billion in 2012,» Vargas said.
The agency could sell its Bonar X positions, which totaled about ARS8.3 billion at the end of June. But the government would have to issue additional debt to Anses during the year to bridge the gap, according to Barclays.
Anses publishes information about its investment portfolio with a three month delay to prevent market participants from speculating in Argentine assets, according to agency officials.
Anses’ overall investment portfolio grew 27.2% on the year to ARS191 billion as of June 30.
The biggest gains were noted in equity investments, which rose to ARS24 billion, and financing for infrastructure and industrial projects, which totaled ARS23.6 billion.
Anses has invested in projects ranging from public housing to the completion of the Atucha II nuclear power plant as part of Kirchner’s job creation policy.
Public pension systems that don’t create jobs «are useless», Economy Minister and vice presidential candidate Amado Boudou said at a pension seminar earlier this month.