Argentina’s liquidity crisis is the result of a perfect storm of external and domestic factors. With the U.S. Federal Reserve tapering off its quantitative easing program, higher interest rates in the U.S. are siphoning off investment dollars from higher-risk emerging economies like Argentina’s. But domestically, Macri’s unpopular austerity policies—meant to repair the economic damage done by his predecessor, Cristina Fernandez de Kirchner—have failed to translate into the sustained growth he promised. Macri had hoped to pursue his fiscal rebalancing act gradually and counted on the political dividends of a healthier Argentine economy to give him the necessary time to do so.
The currency crisis and the sharp economic contraction it has triggered have dashed those plans, amplifying earlier rumblings of popular discontent and raising fears in Argentina that the country might be heading for a replay of its traumatic 2001-2002 crisis. This collection of five WPR articles provides comprehensive analysis and context to better understand this headline news.
***https://www.worldpoliticsreview.com/insights/25755/argentina-s-currency-crisis-raises-the-political-heat-on-macriMore:
