ARGENTINA: Stock market and exchange rates are stable as re-elected President Cristina Fernandez is expected to continue economic policies
Record ID:
446678
ARGENTINA: Stock market and exchange rates are stable as re-elected President Cristina Fernandez is expected to continue economic policies
- Title: ARGENTINA: Stock market and exchange rates are stable as re-elected President Cristina Fernandez is expected to continue economic policies
- Date: 25th October 2011
- Summary: BUENOS AIRES, ARGENTINA (OCTOBER 24, 2011) (REUTERS) VARIOUS OF DOWNTOWN AND CARS PEOPLE WALKING DOWNTOWN POLICE LOOKING ON GENERAL VIEW OF CURRENCY EXCHANGE HOUSE VARIOUS OF SIGNS WITH EXCHANGE RATES (SOUNDBITE) (Spanish) VOTER, AIDE GONZALEZ SAYING: "Look, I don't think much is going to change. The important thing is that it doesn't come crashing down. But yes, I trust that everything is going to stay more or less the same, or it could get better." ARMOURED VEHICLE DRIVING DOWNTOWN GENERAL VIEW OF FINANCIAL DISTRICT EXCHANGE RATE SIGN (SOUNDBITE) (Spanish) UNIDENTIFIED VOTER SAYING: "Knowing the president is going to continue her process, the businesses, the financial sector, and the productivity sectors in the country all know we are going to have a little more of the same. And maybe the lady will make an effort to show gratitude for this vote of confidence from the country and do things a little bit better." VARIOUS OF STOCK MARKET FLOOR TICKER SHOWING STOCK RATES TRADER ON PHONE GENERAL VIEW OF SCREEN (SOUNDBITE) (Spanish) MARKET EXPERT JORGE COMPAGNUCCI SAYING: "The government's victory has not changed the profile of how the market has moved in stocks or exchange rates. It's more of an international situation that has obviously moved an Argentina that has difficulty accessing international credit that has caused capital flight." VARIOUS OF PEOPLE WALKING VARIOUS OF EXTERIOR OF CENTRAL BANK
- Embargoed: 9th November 2011 12:00
- Keywords:
- Location: Argentina, Argentina
- Country: Argentina
- Topics: Politics
- Reuters ID: LVA5IWFAKU7WB3K95EBGNAQB4NFQ
- Story Text: There was a sense of calm in crisis-prone Argentina on Monday (October 24), a day after President Cristina Fernandez won a landslide re-election.
The centre-left president owes much of her popularity to a nearly nine-year economic boom, sustained by high global prices for grains exports as well as free-spending policies aimed at creating jobs and expanding welfare and pension payouts.
Her quirky policy mix has led to 8 percent growth, the fastest in Latin America. And while there are warning signs -- high inflation, wariness from global investors -- the stock market was stable and exchange rates were virtually unchanged.
Strolling downtown Monday, voter Aide Gonzalez said it should be business as usual for a while.
"Look, I don't think much is going to change. The important thing is that it doesn't come crashing down. But yes, I trust that everything is going to stay more or less the same, or it could get better," Gonzalez said.
In her first term, Fernandez nationalized private pensions, fought powerful farmers over taxes and ignored international arbitration awards to private firms hurt during a 2001-02 crisis, prompting retaliation from Washington.
Her unconventional approach has worked so far -- defying critics who have insisted for years that it would soon crumble -- and Fernandez has vowed to "deepen the model."
"Knowing the president is going to continue her process, the businesses, the financial sector, and the productive sectors in the country all know we are going to have a little more of the same. And maybe the lady will make an effort to show gratitude for this vote of confidence from the country and do things a little bit better," said another voter.
Things were quiet on the stock market floor, Argentina's global 2017 bonds, issued during the 2010 debt swap, are yielding about 11 percent. On Monday, returns on Argentina's global bonds fell 0.6 percent, according to JPMorgan's Emerging Bond Index Plus.
Jorge Compagnucci, an expert in markets, said markets had risen, but not because of Fernandez's re-election.
"The government's victory has not changed the profile of how the market has moved in stocks or exchange rates. It's more of an international situation that has obviously moved an Argentina that has difficulty accessing international credit that has caused capital flight."
Fernandez's late husband and predecessor as president, Nestor Kirchner, helped restore growth after the devastating 2001-02 economic meltdown. That was when Argentina defaulted on $100 billion in debt, freeing it from huge borrowing costs but leaving it in the cold in international credit markets.
But while no major shift is expected, Fernandez may be forced to ease the breakneck pace of public spending. It could hit a wall in 2012 as the foreign reserves used to pay debt in the last two years shrink fast.
Since August, the central bank has sold more than $3.5 billion of its reserves to stem the peso's losses as capital flight picks up speed. - Copyright Holder: REUTERS
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