Overview
- Official data showed Argentina’s monthly activity indicator (EMAE) fell a seasonally adjusted 2.9% in July, a shock that led J.P. Morgan to cut its 2026 GDP forecast from 2.7% to 1.5%.
- Markets reacted in late September with the country risk index rising above 600 points and dollar bonds suffering heavy selling before a modest rebound.
- The central bank’s net dollar purchases slowed sharply in September, with reported accumulation figures between about US$211 million and US$313 million, while large seasonal agro exports helped keep the official peso-dollar rate broadly contained.
- Economy officials led by Luis Caputo have ruled out expanding the peso monetary base and say large contingency buffers exist in swaps, reserves and futures but those resources require political or external decisions to mobilize.
- Investors now see October’s main stress as interest-rate dynamics driven by U.S. Treasury yields, oil and Brazil’s political risk, a mix that could raise financing costs for 2027, squeeze reserves and keep domestic credit costly for households and firms.