Argentina

Research evidence excerpt

Argentina

r-effort.

est; (iii) an additional US$1.5bn in privatizations; and (iv)

US$2bn in “other” financing, referenced in the press confer-Importantly, the authorities have indicated that they do not

ence as bilateral loans. We view these assumptions as consis-intend to refinance IMF maturities. When asked about the

tent with a scenario in which President Milei retains a strongU.S. swap as a contingent option to stabilize the FX market,

competitive advantage over the opposition candidate throughthey said it could be available if needed and subject to negoti-

the election cycle.ation, but it is not part of the base case either.

Assuming a more polarized election cycle, we stress the pro-Over the medium term, Caputo added that the administration

gram’s key assumptions to US$2.5bn in Bonar issuance,aims to reach investment-grade status by 2031, at the end of a

US$1bn in privatizations, and US$3.5bn in IFI (ex‑IMF)potential second term for President Milei. While acknowledg-

financing. In that scenario, and in the absence of additionaling the challenge, officials said they have discussed this

alternative funding, the remaining financing gap would likelyobjective with rating agencies and will continue working to

be met through higher Treasury USD purchases to the BCRA,improve Argentina’s metrics with the goal of ultimately

and/or international market issuance.achieving it.

Two considerations are worth flagging. First, our stress case

2027 hinges on local law rollover capacity does not incorporate potential contingent liabilities such as

With more than half of the year already behind us, authorities the final judgment on the EUR GDP warrant (roughly

expect the 2026 USD financing program to close with an EUR1.3bn plus interest). Second, while not part of the Trea-