AssessmentsJul 1, 2025 | 15:42 GMT
The Challenges Facing Argentina's New IMF Program
Argentina has made significant strides in terms of macroeconomic stabilization and, bolstered by a new IMF program, the country's short-term outlook remains broadly favorable, despite approaching legislative elections in October and the concomitant risk of policy slippage. Since taking office in December 2023, the government of President Javier Milei has implemented a very substantial fiscal adjustment and broader structural reform. This enabled Argentina to reach a new agreement with the International Monetary Fund (IMF) in April, which commits the government to continued fiscal discipline, a liberalization of exchange rate policies, and structural reform. The new IMF program will also provide Argentina with foreign-exchange liquidity, thus making the country's external financing outlook more manageable. As a condition necessary to secure the IMF program, Argentina abolished its crawling peg exchange rate regime, which risked exacerbating peso overvaluation and balance-of-payments problems. The government has adopted a floating foreign exchange regime within a pre-determined
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