Milei wins Argentina primaries as dollar hits 730 pesos

Milei wins primaries as the dollar jumps to 730 pesos

Javier Milei has won Argentina’s primary elections, and the market did not wait for the definitive October vote to react. As the libertarian confirmed his victory, the parallel dollar rose from 615 pesos on Friday to 725 on Tuesday, reaching 730 in the next update. August’s inflation was estimated above 15% monthly, with forecasts nearing 200% annually, sparking open discussions of another hyperinflation. Amidst this volatile landscape, the debate intensifies over exactly who Milei is.

From liberal perspectives, he is described as a radical liberal, not a fascist or religious integralist, aligning closer to classical liberalism than conservative Catholicism. The controversy deepens with his announced plan to move Argentina’s embassy in Israel from Tel Aviv to Jerusalem, a move inconsistent with the label of improvisational populist but indicative of a clear ideological roadmap.

What is Milei: liberal, ultraliberal, or far-right?

The label has become a battleground. On public television, he was called ultraliberal, ultraconservative, ultra-right, and far-right in under a minute, according to media tracking. For some analysts, this accumulation of adjectives proves the term is used as a weapon rather than a description.

Some argue that for certain pogre, far-right refers to anything questioning uncontrolled immigration or seeking to reduce the State’s size, as it touches the privileges of some and the narratives of others. On the opposite side, another block labels him anarcho-capitalist, considering it a notable phenomenon that such a profile wins elections in Argentina. Neither resolves the core question: what will he do with power?

The dollar surges before votes are counted

Numbers tell the story better than adjectives. The dollar’s exchange rate rose from 615 pesos on Friday to 725 on Tuesday, settling at 730 in the next update. Parallel to this, August’s inflation estimate exceeded 15% monthly, with 2023 forecasts at 200%, making hyperinflation more than a talk-show hypothesis.

The detail matters: Argentina’s problem is not just that the peso is weak, but that no one trusts it. When people can save, they do so in dollars, inside or outside the country. Without currency freedom, there is no serious way to attract foreign direct investment, the first hurdle for any stabilization plan. The full breakdown of the escalation explains why the market moved before politicians.

Dollarizing Argentina: the promise no one knows how to execute

Milei knows what needs to be done in Argentina. The problem is no one knows how. Lifting the exchange controls, eliminating social plans, and dollarizing the economy sounds like a closed recipe, but the transition from announcement to reality could topple a government. The most optimistic calculation assumes the country returns to being a power in fifteen years; the pessimistic one does not rule out civil war along the way.

Facing dollarization is the classic objection: you hand monetary policy to the Federal Reserve and become dependent on whoever prints. This argument repeats every time a country looks to the dollar as an anchor, and Argentina has been the laboratory for these trials for decades.

Milei, VOX, and the Madrid Charter

The victory has peine discussions about family ties in Spain. Milei is among the first signatories of the Madrid Charter against socialism, aligning him with the orbit of VOX and Santiago Abascal, although here the party itself was labeled ultra-fascist until four days ago. The consistency of labels, once again, shines by its absence.

In economic terms, the second-most-voted force, Patricia Bullrich, also promises to lift the exchange controls on day one. In other words, the hard program is not the property of a single candidate: it is what a relevant part of the Argentine electorate has decided to vote for after years of deterioration. The question is whether the political system and the street can withstand the adjustment.

What no one has resolved

The data that disconcerts friends and foes alike remains: 150 years ago, Argentina was the world’s first country in per capita income. Today, the discussion is not how to return to that position, but whether the liberal experiment survives the first months without the country breaking apart. Milei has the diagnosis, the mandate, and no manual. Everything stalls there, and the history continues, without resolution or safety net.