Argentina’s primary election “frightened” financial markets

The results of the primaries of the Argentine presidential election have led to the “three kills” in the country’s stock market, foreign exchange market and bond market. According to a Reuters report on the 12th, due to the fiasco of the current president Mauricio Macri in the 11th primary election, the market worried that Argentina may resume the practice of the former government intervention in the economy.

Argentina’s “National News” said that the vote showed that Markley won 32.08% of the votes in the primary election, and his main competitor, Fernandez, who was elected by former President Christina, won 47.65%. The results of the primary election will determine the final candidates for each party. This gap means that the opposition may win directly in the first round of voting on October 27, and there is no need to conduct a second round of voting in November. According to regulations, the presidential candidate needs at least 45% of the votes, or 40% of the votes and 10% of the second place, you can directly win the presidential election.

Reuters said that the Argentine peso had once expanded to 30.3% against the dollar, and closed 15% to 53.5 pesos. Argentina’s main stock index MERVAL fell 31% at the close. The five-year credit default swap price against Argentina’s debt default also rose sharply. Argentina’s “Clarion” said that the performance of the Argentine financial market on the 12th was the worst day since 2001. The Argentine central bank used $105 million to inject capital into the financial market to prevent capital flight. Since 2010, former President Cristina of Argentina has implemented a high welfare policy, resulting in a double deficit in the current account and fiscal accounts in Argentina. After taking office in 2015, Marki promised to restore his economy with a free market policy.

Fernandez, who is supported by Christina, advocates easing and proposes policies to provide retirees with free medicines and raise workers’ wages. Reuters said that although Mark’s efforts to reverse the economic situation are facing difficulties, investors believe that the greater risk comes from Fernandez. The US Business and Consumer Channel (CNBC) reported that the primary election was seen as a “referendum” on Markley’s economic reform measures. Macquarie’s policy is more intimate with the business community. He previously promised that if he succeeded in re-election, he would continue the previous tightening policy.

The National newspaper said that Fernandez believed that his economic proposition was not “closed,” he hoped that the pain of the Argentines would stop. “If I can do something to stop them from suffering, I will do so.” The only person in charge of the Argentine dilemma is Markley. However, the Brazilian news website “G1” said that after more than three years of Macquarie’s coming to power, Argentina did not get rid of the economic crisis, and the inflation rate exceeded 55%, causing Argentina to borrow $57 billion from the International Monetary Fund (IMF). Brazilian President Bossonaro reiterated on the 12th that if Mark Reiner fails, the opposition will regain control of the regime, Argentina will become another Venezuela, and Brazil does not want to see Argentines flee to southern Brazil to seek refuge. In this regard, Markley said that he will not reorganize the government because he believes he can reverse the election.