Examining Milei’s Triumph through the Lens of Investment Banking

In the aftermath of Javier Milei’s election, the international financial market has turned its attention to the urgent need for reforms and the potential challenges that lie ahead. While Milei’s first speech as president-elect was characterized by unexpected moderation, his proposed libertarian plan has raised concerns about financial stability.

Jaime Reusche, Vice President – Senior Credit Officer de Moody’s Investors Service stated that Milei faces extreme challenges with highly uncertain outcomes. The credit agency focused on the consensus necessary to carry out the proposed reforms and on governance, noting its concern about a divided Congress and social pressures that will influence the incoming president’s ability to implement corrective policies.

JP Morgan warned about the risks of implementing the measures announced by Javier Milei in a report for its clients. They noted that his proposed reforms are bold, but that there may be political maneuvering that will hamper their implementation. They also believe that governance risks loom given the lack of party structure and the distribution of power in Congress after the general elections.

Barclays also focused on governance and warned that for Milei, the biggest challenges will come from the social front. They believe that economic results will be key in determining whether or not Milei is able to maintain support from middle-income sectors. Meanwhile, US bank believes that another year could pass before a decision is made regarding dollarization of economy.