Argentina’s markets are bracing for more losses after a provincial election, set for Sunday, as libertarian President Javier Milei scrambles to shore up voter and investor confidence amid a misfiring economy and a two-week-old corruption scandal that has thrown doubt on the future of his reforms.
The benchmark stock index has fallen 20 per cent in the past few weeks and is down 30 per cent since early January, after soaring 170 per cent last year in the euphoria that followed Milei’s election. Investors fear that a bad result for the government on Sunday could extend the losses, as polls suggest voters are losing patience with Milei’s agenda.
The president’s administration has battled to support the peso and contain inflation ahead of the election in Buenos Aires province — pushing up interest rates, increasing bank reserve requirements to restrict the amount of money in circulation and selling US dollars to steady the exchange rate.