Milei Approval Hits New Low ahead of key election

Argentina's Political and Economic Landscape - Miller's coalition needs over 34% support in the midterm elections to pass economic legislation [1] - Investors anticipate Mitchell securing a third of seats in Congress to protect Miller's vetos [2] - Failure to secure one-third of seats could pressure the peso and sovereign bonds, potentially leading to policy changes and cabinet overhaul [5][6] - The US is providing unprecedented support to Argentina, conditioned on Miller's party winning the midterm elections [8][9] - The election results will be closely watched province by province, especially in Buenos Aires, where a third of Argentines live [10] US-Argentina Relations and Geopolitical Implications - The US Treasury considers Argentina a systemically important ally in Latin America [17] - Argentina possesses significant lithium, uranium, rare earth reserves, copper, and gold, potentially influencing US support [14] - China's presence in Argentina, including a space station and an $18 billion swap line with the Argentine central bank, is a point of concern for the US [15] Financial Support and Market Impact - The US support includes a $20 billion currency swap line, peso purchases, and negotiations for another $20 billion in Wall Street financing [7][8] - Market speculation suggests disagreements within the Argentinian administration regarding currency policy [4] - The market will react to the election results, particularly concerning sovereign bond performance and currency stability [4]