Group 1 - The Argentine central bank has spent $1 billion to defend the peso amid a political crisis, selling over $678 million in foreign reserves in a single day, the highest since October 2019 [1] - The peso has been declining almost daily for the past two weeks, with a drop of 9% attributed to the political setbacks faced by President Milei's party in local elections [2] - The government is under pressure to maintain the current exchange rate mechanism, with economists estimating that it would require $9.75 billion to defend the peso until the elections, which may be too costly for the government [2] Group 2 - Despite the government's efforts to reassure investors and implement stricter trading controls, investor confidence remains low, leading to a poor performance of the Argentine S&P Merval index [2] - The country's risk index has reached its highest level since August 2024, hovering around 1500 basis points, indicating a lack of investor confidence [2] - Continuous dollar sales may deplete foreign reserves, jeopardizing short-term debt repayments and potentially leading to increased bond issuance to cover funding gaps [2]