Argentina's Economy Minister announces phenomenal recovery after elections

Minister of Economy Luis Caputo stated today that “after the elections” on October 26th, there was a “phenomenal recovery” that will be reflected in a “much more positive” fourth quarter in terms of GDP growth. Speaking at the opening of the XXXI Conference of the Argentine Industrial Union (UIA), Caputo reiterated his defense of maintaining the exchange rate bands and emphasized the “political volatility” that comes with having an opposition with leaders “with certain acceptance who want to go in another direction.” He also highlighted the importance of President Javier Milei's role as a leader in the “cultural battle,” to the point of presenting him as one of the “three world figures” of greatest importance. “We expect a third quarter that will be much more positive,” he said, confusing the July-September period with the October-December one, “and for next year, we have an optimistic outlook,” he stated. Furthermore, he reiterated that from now on, there will be a process of reserve accumulation by the Central Bank and that the exchange rate bands are “well-calibrated.” During a week in which he made several public appearances, Caputo admitted that he “gets bored” of hearing repeated concepts, especially in his references to the need to maintain the exchange rate band system instead of implementing a free-floating regime. In this regard, as he had indicated the day before when speaking at an event organized by the Latin American Economic Research Foundation (FIEL), he pointed out that very few countries in the world have free-floating exchange rates and cited the experience of countries like Brazil, Chile, Colombia, or Israel, which used managed floating schemes, in some cases for up to ten years. The head of the Ministry of Finance highlighted that the country is at a “turning point” where, for the first time, “a macroeconomic order is reached without a crisis and by political decision” and not as a consequence of a collapse as at the beginning or end of the Convertibility. “This macroeconomic order had backing at the polls,” he said, adding that it was achieved with a combination of “an economic factor, a social one, and a political one,” and also emphasizing that “on December 10th, we will have a Congress aligned with what the people voted for.” On the other hand, despite the fact that the October Consumer Price Index was the highest in the last five months, Caputo assured that it “proves that the program is very solid” since “at another time, with an attack like the one we had, we would have had higher figures.” In this regard, he made a special mention of the “political volatility” marked by “politicians with certain acceptance who want to go in another direction.” “If we want to graduate to being a serious country, we cannot have this political volatility; political alternation must be rational, we cannot go from capitalism to communism, otherwise, it will be very difficult to float,” he stated. In light of this “volatility,” the minister acknowledged that “the economy started to stabilize after the attacks in Congress,” but that “after the elections, there was a phenomenal recovery” and that the last quarter of the year will be “much more positive,” with an “optimistic vision” for 2026. In this sense, he highlighted the investments approved or under evaluation by the RIGI for a total of USD 51,338 million and that “in a few years we are going to have an energy balance that will be double that of today's agriculture,” so that in 2030 and 2031 the trade surplus could be “around USD 47,000 million.” “A phenomenal entry of dollars is coming,” he exclaimed, while framing this process within “the cultural battle in which President Javier Milei is today the leader.” Caputo asserted that Milei “today is one of the three world figures. And it is us, Argentina, let's give importance to this.” “Milei generates a level of optimism that tips the balance in our favor; there is no more to see than the election in Bolivia and we will have to see what happens in Chile,” he concluded.