Argentina’s controversial new leader’s plan to tackle hyperinflation may be working. His liberal austerity “shock” measures translated into lower inflation rates.
Javier Miley wins the presidency of Argentina
Right-wing candidate Javier Miley won the presidential elections in Argentina on Sunday.
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Argentina’s chainsaw-wielding, self-proclaimed “anarcho-capitalist” president, who says he takes most of his political advice from his dogs, appears to have achieved what many political and economic analysts said his extreme plans almost certainly would not: modest improvements in… Economy. The country’s economy.
Javier Miley, 53, a former right-wing economist and television analyst whose combative style and embrace of conspiracy theories have drawn comparisons with Donald Trump, took office in December.
Five months after he was sworn in, Argentina still has one of the highest annual inflation rates in the world — a cumulative figure of 287% as of March, according to Bloomberg data But Miley’s liberal austerity “shock” measures have translated into lower inflation rates every month for the past three months.
When national inflation figures for April are published next week, there are some signs of this Argentina’s economy It could see a return to single-digit monthly inflation for the first time since October 2023.
In his first weeks in office, Miley made major cuts in public sector spending in Argentina, halting new infrastructure projects, cutting energy and transportation subsidies for the population, and halving the number of Argentina’s federal ministries. He also devalued the country’s currency, the peso, by more than 50% against the US dollar.
Advice from dogs: Chainsaw system. Javier Miley, a far-right liberal, is Argentina’s new leader
Ian Bremmer, Founder Eurasia Group The political and economic risk consulting firm wrote in an email newsletter late Wednesday that when Miley was elected…, Many experts predicted that his plans for the economy would lead to “further collapse in a short time.”
“Fortunately for the people of Argentina, this did not happen,” he wrote. “Monthly inflation has fallen every month over the past three months, from 25% in December to nearly 10% in March, and forecasters expect the April number to come in the single digits. The government did this by shifting… With a budget deficit of 5.5%, it inherited the country’s first surplus in more than a decade, while working to bolster central bank reserves, cut benchmark interest rates, and reduce the money supply – all without destabilizing currency and financial markets.
Javier Miley brandishes a chainsaw, threatens to blow up Argentina’s central bank and says climate change is a ‘socialist conspiracy’
Latin America’s second-largest country and third-largest economy has suffered from economic and political dysfunction for decades. It has defaulted on its sovereign debt nine times. Tens of billions of dollars have been borrowed from… International Monetary Fund And, at recent days, China is suffering from economic turmoil.
Miley has long claimed to be committed to a line of libertarianism that contains at its core a political and economic philosophy that effectively calls for the abolition of the state.. During his election campaign, he repeatedly brandished a chainsaw to symbolize his intention to cut public spending to fix Argentina’s troubled economy. He also claimed that he was thinking of “blowing up” the Argentine Central Bank, which did not happen.
Miley called climate change a “socialist conspiracy.” He has consistently downplayed the atrocities committed by Argentina’s military dictatorship in the 1970s and 1980s. He claimed to get the best advice from Murray, Milton, Robert and Lucas. Murray, Milton, Robert and Lucas are his four dogs.
Related: At the coronation of King Charles III, these dogs stole the show
Elon Musk is a fan
He appeared to be associated with it Tesla and X owner Elon Musk About free markets and the necessity of defending freedom and personal liberties. “I recommend investing in Argentina,” Musk said in a recent X post in which he was photographed for the second time in less than a month giving a thumbs-up alongside Argentina’s leader.
What do you know about Javier Miley: Why do people talk about the president of Argentina?
However, many Argentines complain that Miley’s economic policies have made their lives more difficult in the short term, as spending cuts have hurt salaries and pensions that are still far from keeping up with inflation.
Trade unions across Argentina are expected to hold a 24-hour nationwide general strike on Thursday, as Miley’s cost-cutting program leads to a sharp contraction in consumption, construction and manufacturing activities. Massive protests against public university budget cuts recently attracted more than 400,000 people.
Carrying large amounts of banknotes; Companies prefer cash
Argentina’s central bank was forced on Tuesday to issue its first 10,000 peso banknote, worth about $11, because many residents were carrying large stacks of bills to make even small payments. Many companies in Argentina still prefer to transact in cash partly due to chronic economic instability.
in Interview with the BBC this weekHowever, Miley insisted that his economic reforms were successful and mainly targeted Argentina’s political class – the elite – and not ordinary citizens.
Defending his policies, he said: “There is no magic. Real life takes time.”
He asked, “What is the alternative? Continuing to print money like the previous administration, which generates inflation and ends up affecting the most vulnerable groups?”
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