The beating that the pro-business President Mauricio Macri received in a party primary election over the weekend from the populist centre-left candidate Alberto Fernandez has led to the plunging of both Argentina's peso and the Buenos Aires stock exchange market, AFP reported on Monday August 12th.
Nervousness reigned as the peso opened at 53 to the dollar, a drop of 14% from its closing figure of 46.55 on Friday, before plummeting further to 60, leaving the markets reacting with anxiety over Macri's rout, causing the Merval index to plunge 10% as well.
Macri called a meeting with Central Bank president Guido Sandleris before the markets opened on Monday, while putting back his morning cabinet meeting to 3:30 pm (1830 GMT.)
The centre-right Macri was dealt a huge blow on Sunday August 11th in his bid for re-election in October when he polled 15 points less than centre-left Peronist candidate Alberto Fernandez. According to Fernandez, “The markets are giving warning that the government has put itself in a position it cannot respond to.”
Argentina is currently in a recession and posted 22% inflation for the first half of the year, one of the highest rates in the world, and poverty now affects 32% of the population.
According to Macri, the way to fight a “bad election” is by immediately redoubling efforts “from tomorrow” but his popularity has plummeted since last year's currency crisis and the much-criticised $56 billion IMF bail-out loan he secured.
Meanwhile, Fernandez assured thousands of cheering supporters in Buenos Aires on Sunday night August 11th that "We're going to begin a new stage. We always fix the problems that others create,” according to AFP.