A Challenging but Achievable Financial Program
As the year comes to an end, questions arise about whether Argentina has the funds to meet its 2025 debt obligations. The financial needs seem daunting—around $17 billion in dollar-denominated requirements and 11% of GDP in peso debt. However, upon closer inspection, the outlook appears more manageable, and unless a “black swan” event occurs, there […]
Opening Up the Economy… to Lower Inflation or to Be More Efficient?
There is no doubt that Argentina is a very closed economy. Imports represent only 14% of GDP, when the regional average is 25% of GDP.
It’s MAGA: Make Argentina Great Again
The meeting between Milei and Trump had an impact because it took place just a week after the elections, and because Milei was the first president to meet with the president-elect since then. The meeting was framed in a context where the government has been doing well. The fiscal balance is consolidated as non-negotiable, inflation […]
A Crucial Test for Milei: The Aerolíneas Conflict and the Legacy of Thatcher and Reagan
The conflict between Milei’s government and Aerolíneas Argentinas, along with Intercargo, is not merely a clash with a unionized sector or part of a budget-cutting plan; it’s a pivotal battle to determine whether a regime change can be achieved—a watershed moment for advancing other structural reforms. While the macroeconomic program is central to bringing down […]
A Unique Interest Rate Policy That Continues to Lower Real Debt
The government is on a winning streak, in terms of country risk, the exchange rate spread and inflation. There is no doubt that the plan has gained credibility over time and that inflation has been falling faster than many of us expected. Given this context, it was to some extent expected that the Central Bank […]
Argentine Bonds Are Rallying, and Country Risk Fell Below 1,000 Points
The country risk dropped to 967 basis points last Friday. It is the lowest level since before the 2019 primary elections. At the beginning of the year, we had forecast that it could reach 800 bps in December, and if the trend continues this may happen. Our optimism, at that time and now, is based […]
Surprises and Highlights of Milei’s Speech at the BCRA
BCRA’s Monetary and Banking Conferences were held last week, and after listening to officials, economists and even Milei himself, there was a feeling in the air that there is no hurry to eliminate the FX restrictions, although some regulations may be relaxed to favor imports.
The Government, Leading the Championship Against Inertia
The government scored a good victory against a difficult opponent, inflationary inertia, but the championship is long and the champion is not yet defined. The national CPI showed an increase of 3.47% in September and was in line with our estimates and those of the market. It was the lowest inflation since November 2021. The […]
From Dogmatism to Pragmatism
On Monday, Milei surprised by showing his first signs of understanding realpolitik. In his interview with Susana Giménez, the president changed his speech about China: “I was very pleasantly surprised. It is a very interesting trade partner because they do not demand anything, they only ask not to be disturbed”. He also confirmed that he […]
The Social Situation, Another Urgent Stabilization
The poverty and indigence numbers are shameful, but they were not surprising. Months ago it was estimated that poverty in the first semester would be close to 50% and it was 52.9%. Indigence reached 18.1%, indicating that 34% of the poor also have problems to feed themselves, which is what extreme poverty or indigence is […]