Milei’s unexpected big win means Argentina’s reforms will continue, and the US has avoided “bailing out losses.”

``` Argentinian President Milei achieved a surprising victory in the midterm elections, winning crucial public endorsement for his radical austerity policies and giving the U.S. government, which previously provided $20 billion in currency swap support to the country, a sigh of relief. On October 27, according to media reports, data released by Argentina’s Interior Minister Guillermo Francos on Sunday (October 26) local time shows that, with 92% of the votes counted, the Liberty Advances party led by Milei received 41% of the votes, significantly ahead of the main rival Peronist Party’s 24.5%. Francos stated that Milei’s party won 64 out of the 127 seats in the lower house being contested. With election uncertainty dissipating, markets expect an upswing on Monday. Milei’s party currently holds only about 15% of lower house seats, and this victory will provide it with a stronger foothold in Congress, likely reaching or even exceeding the critical threshold of one-third of seats, thereby enabling the president's veto to be shielded from being overturned by the opposition. This election is crucial for Argentina’s political and economic future. The peso sell-off triggered by losses in September’s local elections led investors to worry about Milei’s governing base, eventually prompting the Trump administration to intervene to support the peso and the Argentine government. According to a previous WallstreetCN article, U.S. Treasury Secretary Bassente signed a $20 billion currency swap agreement before the election and directly purchased pesos to stabilize the exchange rate. **A Political Turnaround from Heavy Defeat to Big Victory** After suffering a heavy blow in the Buenos Aires provincial elections in September, Milei achieved a political turnaround in just two months. This midterm involved the re-election of half the seats in the lower house and a third of the seats in the upper house, serving as a key nationwide referendum on Milei and his radical austerity policies. Reports say that the Liberty Advances party’s leading results in most provinces of Argentina have significantly reversed the earlier downward political trend. The Peronist Party’s vote share plummeted from an overwhelming advantage in last month’s local elections to 24.5%, indicating a major shift in voter sentiment. This victory will boost Milei’s party’s share of the lower house from the current roughly 15% to a significantly higher percentage, likely reaching the one-third threshold needed to protect the president’s veto power. In recent months, opposition lawmakers have repeatedly managed to overturn Milei’s vetoes, but the new seat distribution is poised to change this balance of power. **The electoral victory may help Milei open a new chapter politically.** Since the beginning of the year, President Milei and his party have faced three corruption scandals, economic slowdown and high unemployment in Argentina have also pushed his approval rate to its lowest point during his term. This midterm win provides a stronger congressional foundation for Milei to advance key economic reforms. **A higher share of seats means Milei will have greater ability to push his austerity policies and structural reform bills, without excessively relying on the opposition’s support or worrying about his veto being overturned.** For investors, the election result eliminates the biggest uncertainty regarding policy continuity in Argentina and reduces the risk that the United States’ substantial financial support might go to waste. **Monday’s expected market rebound will reflect confidence that Argentina’s reform path can continue.** **America’s Big Gamble Pays Off** This election result also vindicated U.S. Treasury Secretary Bassente’s extraordinary support for Argentina. On the eve of the election, the United States signed a $20 billion currency swap agreement with Argentina to shore up the beleaguered peso—which has lost more than 30% of its value this year. Reports note that U.S. intervention didn’t end there. Washington directly purchased pesos before the vote and coordinated with Wall Street banks to provide extra financial support to the Milei government. Two weeks ago, President Trump met with Milei at the White House; the latter has become one of this American leader’s most enthusiastic supporters abroad. According to reports, Washington’s support comes on top of the $20 billion aid program launched by the International Monetary Fund in April this year. Last year, Argentine bonds—then the best performers among emerging markets—suffered heavy losses because of the September election defeat and U.S. bailout plans. With electoral uncertainty out of the way, these assets are expected to rebound. Risk warning and disclaimer The market has risks; investments should be made cautiously. This article does not constitute personal investment advice, nor does it take into account the individual investment objectives, financial situation, or needs of any specific user. Users should consider whether any opinions, viewpoints, or conclusions in this article apply to their particular situation. Investing based on this article is at your own risk. ```