Argentina, awaiting the consequences of the defeat of the Government in the legislative elections

The defeat of the ruling party in the legislative elections in Argentina complicates the maneuverability of President Alberto Fernández in Congress, in a scenario of economic crisis that, like his predecessor, Mauricio Macri, he cannot control.

The stock market in Argentina reacted cautiously on Monday, while the price of the informal parallel dollar opened relatively stable and bonds with moderate optimism, after the defeat of the ruling party in the legislative elections this Sunday.

Meanwhile, Argentina’s country risk index fell 1.9%, to 1,714 basis points and the so-called “dollar blue” (informal retail market) increased one peso, to 201 pesos per unit for sale, after having starred an escalation in the weeks leading up to the elections.

Nor was an exchange rate jump in the price of the dollar observed in the formal wholesale market, where operations are very limited by various restrictions imposed by the Argentine authorities and regulated by the interventions of the Central Bank, which advanced nine cents in the first positions of this Monday, at 100.31 pesos per unit for sale, collects Eph.

Argentina’s main opposition coalition, Juntos por el Cambio, to which Macri belongs, outstripped the ruling party in the country’s most important districts, albeit by a very narrow margin in the decisive province of Buenos Aires.

More than 34 million Argentines were called to vote at the polls 127 of the 257 seats in the Chamber of Deputies – where no group now has an absolute majority – and 24 of the 72 in the Senate, in which the Peronist ruling party will lose its comfortable majority if the data is confirmed in the final scrutiny that the Electoral Justice will carry out in the next few days.

The elections, the first with Fernández as president, were considered a kind of plebiscite in his first two years in office, marked by the management of the pandemic and the continuity of a long recession that began in 2018 -some experts cite earlier-, when there are another two years left for the next presidential election.

This appointment with the polls came preceded by the primaries of last September, in which the lists of Together for Change were already the most voted in almost the entire country, ahead of the Government’s proposals, which generated strong tensions between the president and former president and today vice president Cristina Fernández.

This situation led to the change of several ministers and the announcement by the Government of a cataract of measures aimed at improving the pockets of the most neglected sectors of society.

Analysts consulted in the days prior to the election commented that the relationship between the factions of the president and the vice president are quite worn out, but despite the tension, it is most likely that they will seek a way to remain as allies because otherwise they would weaken further, according to media What BBC and locals like Clarion and The nation.

Likewise, these elections are also crucial for the opposition, to order leadership after Macri’s defeat against the Fernándezes in the 2019 presidential elections.

Something important while a sector of Argentines blames Macri for the economic situation and the debt with the International Monetary Fund (IMF), of 45,000 million dollars, which Fernández now says he cannot pay. While another sector of the citizenry blames the current president for the worsening of the situation and poor management of the pandemic, which has increased the country’s problems. (I)