U.S. Support Boosts Argentina's Market Confidence
President Donald Trump pledged backing to Argentina, meeting with President Javier Milei at the U.N. General Assembly. While Trump downplayed the need for a bailout, he and Treasury Secretary Scott Bessent discussed stabilization options. The World Bank accelerated $4 billion in investments for Argentina's key sectors, igniting market rallies.
In a strategic move to bolster Argentina's financial markets, President Donald Trump offered backing to Argentine President Javier Milei during their meeting at the U.N. General Assembly's sidelines. Trump assured that a bailout was unnecessary but highlighted U.S. support as crucial for stabilizing Latin America's third-largest economy.
Treasury Secretary Scott Bessent emphasized that all options are considered to stabilize Argentina, including using the $219.5 billion Exchange Stabilization Fund and potentially setting up currency swap lines. This follows Trump's endorsement of Milei's re-election bid, aiming to ensure stability in Argentina's financial sector.
Simultaneously, the World Bank announced the acceleration of $4 billion out of a $12 billion support plan for Argentina, focusing on sectors like mining, energy, and tourism. Despite Democratic U.S. Senator Elizabeth Warren's concerns on taxpayer implications, markets reacted positively as the peso appreciated and bonds rose.
(With inputs from agencies.)
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