Argentina

Investors are no longer betting Argentina is heading inevitably to default as President Javier Milei wins over bond markets with his plans to remake South America’s second-largest economy, Bloomberg News reported. The extra-yield investors demand to hold Argentine paper over similarly dated US Treasury yields closed below 10 percentage points, a level that traditionally signals distress, according to data from JPMorgan Chase & Co. The spread is at its lowest levels since August 2019, when former President Mauricio Macri was in office.

A ruling by a high court has set back a distressed takeover by Bunge Global SA of Vicentin SAIC, once the crown jewel of Argentina’s massive soybean-processing industry, Bloomberg News reported. Five of the six judges in the supreme court of Santa Fe province — where family-run Vicentin filed for bankruptcy protection nearly five years ago after a $1.5 billion default — ruled on Tuesday to take on a complaint by a hostile creditor.

Argentina lost a bid at the U.K. Supreme Court to hear its appeal on a ruling that would force the South American nation to pay $1.5 billion in damages to holders of the country’s growth-linked bonds, Bloomberg News reported. In an order signed Monday, the U.K.’s top court refused to hear an appeal over payments to hedge funds including Palladian Partners LP. The holders of those notes argued the losses were a result of a change by a previous Argentine government in how it calculated gross domestic product.

Argentina's triple-digit inflation, the world's highest, is starting to slow but this offers little relief for residents whose salaries have stayed the same while costs of basic goods sky-rocketed and the government slashed state subsidies, Reuters reported. "We're losing track of what's expensive and what's cheap," said university professor Daniel Vazquez while shopping in Buenos Aires. "Prices keep going up and the only thing that isn't going up is salaries." "The gap is very, very big," he said.

For years, Argentina imposed one of the world’s strictest rent-control laws. It was meant to keep homes such as the stately belle epoque apartments of Buenos Aires affordable, but instead, officials here say, rents soared, the Wall Street Journal reported. Now, the country’s new president, Javier Milei, has scrapped the rental law, along with most government price controls, in a fiscal experiment that he is conducting to revive South America’s second-biggest economy. The result: The Argentine capital is undergoing a rental-market boom.

Argentina's economy likely shrank 1.4% in the second quarter versus a year earlier, a Reuters poll showed on Monday, the fifth such decline as a recession deepens under a tough austerity drive by libertarian President Javier Milei, Reuters reported. That median GDP estimate from 15 analysts polled by Reuters for the April-June period would follow a 5.1% year-over-year contraction in the first quarter. The official data is released on Wednesday. Milei's cost-cutting has hurt economic activity and pushed up poverty and unemployment.

Argentina's monthly inflation rate stood at 4.2% in August, official data published on Wednesday showed, rising from last month and surpassing analysts' forecasts, while Argentines tighten their wallets to deal with spiraling costs, Reuters reported. Inflation in the 12 months through August reached 236.7%, still the highest level recorded in the world. Analysts had hoped for a slight monthly slowdown to 3.9%, which would signal progress for the government of libertarian President Javier Milei, which has been focused on taming runaway prices.

MercadoLibre Inc. accused Argentine banks Monday of “illegally concentrating” under one payments platform as an anti-competitive tactic against the company’s fintech arm, Bloomberg News reported. Latin America’s largest company by market valuation filed a legal complaint before Argentina’s National Commission in Defense of Competition after banks — under their shared platform MODO — filed their own legal complaint in May alleging similar anti-competitive strategies by the firm’s Mercado Pago unit.

Argentina's economic activity likely fell in June versus the same month a year earlier, analysts said, back in the red after a rare rise the month before amid tough austerity measures and cost-cutting under libertarian President Javier Milei, Reuters reported. The median forecast from 16 analysts sees economic activity down 1.9% year-on-year in the sixth month of the year, dropping back from May's 2.3% rise, as growth in the grains and gas sectors is weighed down by weak consumption and construction.