The United States is preparing a major financial intervention to stabilize Argentina’s faltering economy, offering a lifeline to President Javier Milei as his country faces mounting economic pressure ahead of crucial mid-term elections later this month.
Treasury Secretary Scott Bessent announced on Wednesday that Washington is considering a $20 billion credit line, currency swaps with Argentina’s central bank, and the purchase of government bonds to support the embattled South American nation. Bessent described the assistance as a “bridge to the election,” referring to the October 26 legislative vote.
The pledge came after Argentine bond prices plunged and the peso tumbled last week, with the central bank spending down its scarce dollar holdings to prop up the currency. The peso dropped 6% again this week before the government intervened to stabilize it at 1,380 pesos per dollar.
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President Donald Trump gave his “full endorsement” to Milei during a meeting at the United Nations General Assembly, calling him a “truly fantastic and powerful leader.” The support marks a stark contrast to Trump’s approach toward Brazil’s left-wing President Luiz Inácio Lula da Silva, whose country faces steep US tariffs.
More than half of Argentina’s population now lives in poverty, according to June 2024 government statistics, with nearly two-thirds of children under 14 affected. The figure has nearly doubled from 27.5% in 2019, following Milei’s aggressive austerity program, which drastically reduced government spending on social programs.
Economists say US financial support may only postpone a currency devaluation until after the elections, when experts predict Argentina will be forced to allow the peso to float more freely.
Separately, large demonstrations filled Buenos Aires streets over the weekend as protesters called for accountability in the brutal killings of three young females — two women and a 15-year-old girl — whose deaths were broadcast live online. Authorities have arrested nine suspects, including the alleged mastermind, a 20-year-old Peruvian drug trafficker detained in Peru this week.
The case has brought national attention to gender-based violence. According to monitoring organizations, a woman dies at the hands of a man approximately every 36 hours in Argentina.
The mid-term elections on October 26 will determine whether Milei’s Libertad Avanza Party can maintain its congressional presence amid economic turbulence and social unrest.
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