Argentina Markets Rally After Milei Midterm Victory

Following President Javier Milei's decisive victory in Argentina's midterm elections, the country's financial markets experienced significant rallies. The yield on Argentina's 10-year bonds dropped sharply, lowering public borrowing costs, while dollar-denominated government bonds surged to record highs across various maturities. Argentina's benchmark stock index, the Merval, jumped as much as 23%, marking its largest intraday increase since November 2023, with financial stocks leading the gains. Additionally, the Argentine peso rose around 9% against the U.S. dollar, its strongest gain in over two decades, supported by prior U.S. financial support and stabilization efforts. These market responses reflect investor confidence in Milei's ability to advance free-market economic reforms and stabilize the nation's economy.