MercoPress. South Atlantic News Agency

Argentine government said to be eyeing injecting pesos into the market to bounce back from electoral loss

President Alberto Fernández plans to accelerate the “recompositing of income“ and recover ”lost jobs,” Kulfas admitted

The Frente de Todos coalition ruling Argentina is said to be going through an internal crisis following last Sunday's results at the Mandatory, Simultaneous and Open Primary (PASO) elections where it lost some 4.8 million votes nationwide from when Alberto Fernández was chosen to the presidency two years ago.

Fernández and Vice President Cristina Fernández de Kirchner were reported to have met privately Tuesday and not in the most friendly manner. The die-hard Kirchnerite group La Cámpora, headed by CFK's son, Deputy Máximo Kirchner is laying all the blame on the President and is reportedly demanding changes to the economic policies.

At the same time and in the absence of better resources, Argentina's economy is concocting a somehow explosive formula of money printing while at the same time trying to keep the peso-dollar exchange rate stable, although it remains a mystery whether this can actually work or for how long.

In any case and in a move to reverse Sunday's outcome, which has surprisingly had a lesser impact on people's lives than expected, the Government of President Fernández is said to be fine-tuning a set of measures to be announced Thursday and which will boost the role of local mayors, if a meeting many of them had with Fernández Tuesday is anything to go by.

At this point, however, there is little information and mostly speculation. In this scenario, one of the few pieces of concrete information was that the US dollar was bouncing back against the Argentina peso after three days of consecutive decline: The unofficial exchange rate (the only one “unrestricted”) was AR $ 179 nuy / AR $ 182.5 sale for US $ 1, after having reached AR $ 186 last week.

Also unofficially, press reports in Buenos Aires hinted increases in pensions and financial assistance to the underprivileged were being evaluated, as well as deductions on the income tax, as well as other Keynesian measures.

The government of Alberto Fernández will seek to recover the votes lost after the pandemic management and will do so through direct aid to the most neglected sectors, but will not deliver a new Emergency Family Income (IFE), official sources confirmed.

Productive Development Minister, Matías Kulfas admitted the government was working to generate measures that allow “accelerating the recomposition of income” and recovering “lost jobs,” while market analysts believe that the government will resort to an expansive “shock” in public spending in the two months remaining before the November 14 general elections, although they warned of macroeconomic imbalances that an avalanche of pesos would cause.