Sat. Dec 9th, 2023

Javier Milei’s election as President of Argentina has caused a 40% increase in the stock price of YPF, the state-owned oil company. This rise occurred after Milei defeated Economy Minister Sergio Massa in the presidential race. Milei’s plans for economic revitalization include privatizing YPF and using the US dollar to stimulate growth.

If Milei’s plans are implemented, there could be significant changes to the Argentine economy. In a radio interview, he stated that his administration’s goal is to increase the value of companies and make them more attractive to potential buyers, ultimately benefiting the people of Argentina. The government had previously nationalized 51% of YPF from Spain’s Repsol, but now manages substantial shale gas and oil reserves.

The positive impact of Milei’s election was felt across the board on Monday, with Argentine stocks and dollar bonds performing exceptionally well. In addition to YPF, other Argentina-linked equities such as Grupo Financiero Galicia and Banco Macro also experienced gains of over 20%. The Global X MSCI Argentina ETF also saw gains of over 11.6% shortly after midday in New York.

Milei described his election victory as the defeat of an outdated model, asserting that there is no turning back. To address Argentina’s historic inflation, a plan is set to prioritize the use of the US dollar over the peso. The anticipation of this new economic era is expected to have an impact on the exchange rate between the two currencies.

By Editor

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