The president will seek support for his economic program in search of recreating trust. Meanwhile, uncertainty seems to have reached investors.
With the dollar ironed and interest rates On the control board as axes of its economic strategy, the president Javier Milei Last Two trips to the United States (USA) in the next 45 days To capture investments and reduce the country risk, a key factor that rises domestic rates.
The first visit, at the beginning of September, will prioritize meetings with entrepreneurs in Hubs such as New York or Californiawhile the second, towards September 23, will take him to the UN General Assembly. However, the expected bilateral with Donald Trump In the White House it is still unconfirmed, overshadowed by global priorities such as Ukraine and the Middle East.
On the internal front, the Minister of Economy, Luis Caputofaces a debt market in pesos under tension: after a tender that only renewed 61% of the maturities at 69.5% rates, the government announced An emergency placement for Mondaydestined to absorb $ 6 billion surplus pesos and avoid pressures on the dollar. The IMF, meanwhile, has warned that high rates could erode the financial surplus, a pillar of the libertarian model, by ensuring the cost of debt interest.
Trump and Milei
The link between country risk, fees and fiscal surplus
According to the government, the country riskaround the 750 basic points -according to the measurement of JP Morgan -, it remains a Obstacle for access to external financing to competitive rates. Milei said that reducing it to 550 basic points is crucial, and its Trips to the US seek to generate confidence among investors to relieve interest rates, They have climbed at 69.5% in the last tender, which impacts the cost of the debt service.
The fiscal surplus, first achieved in 14 years, is at risk, according to the IMF, due to the growing weight of interest, which could force additional cuts or compromise the goals of a primary surplus of 1.6% of GDP by 2025. Meanwhile, negative net reserves of US $ 5,000 million and debt maturities hold the tension.
Emergency tender: an attempt to contain the dollar
The recent debt tender in pesos, which captured $ 9 billion but left $ 5.9 billion without renewing, evidenced the Market caution before high rates and economic uncertainty. This debt disarmament, especially initiated by the elimination of fiscal liquidity letters (Lefi), released a surplus of pesos that threatens to turn to the dollar.
In response, the government announced an extraordinary tender for Monday, with the aim of absorbing $ 6 billion through short -term titles and an increase in paid lace of the Central Bank. This maneuver seeks to stabilize the exchange market, but at a high cost: high rates could stop consumption and investment generating social tensions for the October elections.
In the Government they think that Milei’s trips to the US are a strategic play to attract capital in sectors such as lithium, copper and energy, strengthening reserves and racing the path to the elimination of exchange rate for companies in 2025.
The support of the Treasury Secretary, Scott Besent, to the agreement of US $ 20,000 million with the IMF was key, but the goals of accumulation of reserves depend on genuine income that tenders cannot guarantee. The relationship with Trump, consolidated in the February 2025 CPAC and reinforced by the visit of Kristi Noem in July, could catalyze a political support that accelerates the loss of the country risk. In Washington’s gaze, Argentina is still a secondary ally against global emergencies.
Source: Ambito
