The main US Bank made its projections on the elections next Sunday, September 7 in the province of Buenos Aires.
He JP Morgan He highlighted the elections next Sunday 7 in the Province of Buenos Aires (PBA) as a key instance for the future of the monetary policy of the government of Javier Milei And he shared his projections for the day after, with two possible scenarios after the elections.
On the one hand, The main US bank contemplates as the most likely base scenario a tight victory of freedom advances over Peronism, or vice versasomething that would imply a eventual relaxation of real rates and a possible exchange stabilization to bring relief to markets after the previous weeks of extreme volatility.
In addition, The best performance of any of the two blocks is a potential economic reactivation for the fourth quarter of the yearand a moderation of political risk after the recent scandals of the ruling party for alleged coimas in the National Disability Agency (Andis).
Javier Milei Closing Moreno
At the far end, JP Morgan estimates a wide victory of Peronism less likelysomething that, a priori, will bring more political tension at the national level between the government and the opposition for the October legislative elections.
This outcome provides for greater real rates, and considers greater exchange pressure with a consequent deterioration of the international reserves of the Central Bank (BCRA) to contain the value of the dollar. In turn, it raises more pronounced fiscal and economic risks.
Since July, royal rates rose significantly, in a context of strong exchange intervention by Treasure in it Single and Free Market (Mulc). The fiscal cost associated with the high level of interest rates can reach 0.4% of GDP at the end of the year (0.2% if only the private sector debt service is taken).
According to the financial entity, the surveys show a very even contest between both forces, although they anticipate that electoral participation will be key, since a low level could harm the national ruling.
Source: Ambito
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