¡Buenos días from Louse Point! This is the Rorshok Argentina Update from the 2nd of October twenty twenty-five. A quick summary of what's going down in Argentina.

We’ll start with the economy, which saw a whirlwind of activity this week. As we covered in the last episode, the US announced a potential twenty-billion-dollar financial lifeline for President Milei’s government. Following that news, Milei’s administration kicked its own plans into high gear, launching a temporary tax holiday for agricultural exporters.

The move triggered a massive seven-billion-dollar inflow in just three days. The Treasury quickly stepped in to buy up a large portion of those dollars to boost Central Bank reserves, but it wasn’t enough to prevent the peso from coming under pressure again, forcing the government to sell dollars later in the week.

To cap it all off, the White House confirmed that Milei will now travel to Washington for a personal meeting with US President Donald Trump on the 14th of October.

The market volatility also prompted the government to bring back some currency controls for individuals. The Central Bank has reinstated a rule that prohibits people who buy dollars at the official rate from then buying financial dollars—like the MEP or CCL—for a period of ninety days..

The measure aims to stop a popular arbitrage maneuver where people would buy cheap official dollars and immediately sell them for a profit on the financial market, which was draining the Central Bank’s reserves. In a related move, the Central Bank also clarified that virtual wallets like Mercado Pago are not authorized to sell official-rate dollars, shutting down an easy-access route for many savers.

These financial gymnastics are having a real impact on people’s lives, especially for anyone hoping to buy a home. The recent market volatility has dealt a blow to the country’s fragile mortgage market, which had only recently started to recover. As interest rates jumped, major lenders nearly tripled their mortgage rates to 15%. Some banks have stopped offering new loans altogether, while others have significantly tightened their lending requirements. This credit crunch threatens to shut down what had been a success story for the Milei administration.

While affording a home is becoming a distant dream for many, the government is celebrating a significant drop in the national poverty rate. According to INDEC, the official statistics agency, the number of people living in poverty fell from 38% to 32% in the first half of this year.

However, independent researchers and social organizations are urging caution. They argue that the official figures might be overstating the improvements due to outdated measurement methods and changes in how income is reported. Studies of living conditions in poor neighborhoods paint a much grimmer picture, with many families still lacking basic services and relying on community soup kitchens to eat.

And even for those who are working, a new report shows that having a job is no guarantee of stability. Informal, off-the-books employment has risen to over 42%, meaning four in ten workers in Argentina do not have proper contracts, social security, or legal protections. The study found that young people are hit hardest, with more than six in ten workers under the age of twenty-four employed informally. The data highlights a persistent structural problem in Argentina’s labor market, where having a job doesn’t necessarily mean escaping poverty.

From economic challenges to political ones, a key government ally is now facing tough questions about alleged ties to the criminal underworld. José Luis Espert, President Milei’s main congressional candidate in Buenos Aires province, has been linked to Federico Machado, an Argentine businessman facing drug trafficking and money laundering charges in the United States.

US prosecutors found records showing that a trust managed by Machado sent two hundred thousand dollars to Espert in twenty twenty. Espert, who chairs the powerful Budget and Finance Committee, said he only met Machado once and dismissed the news as a smear campaign. President Milei defended his ally, calling the accusations, hair salon gossip.

These allegations are not helping the president’s image, as a new poll shows public confidence in his government has hit an all-time low. The survey, conducted by the Universidad Torcuato Di Tella, registered its lowest level of trust since President Milei took office.

The report suggests the drop is connected to the recent electoral defeat for Milei’s party in Buenos Aires province and the emergence of a separate corruption investigation, concerning the National Disability Agency.

The government’s approval rating fell across nearly all categories, including its perceived honesty, efficiency, and ability to solve the country’s problems.

Perhaps seeking to shore up support, Milei has reconnected with Mauricio Macri, Argentina’s president between twenty fifteen and twenty nineteen. After more than a year of public distance, Milei and Macri met at the presidential residence to rebuild their political alliance. The move comes less than a month before the crucial nationwide midterm elections on the 26th of October and follows the ruling party’s significant loss in the Buenos Aires province vote.

Away from the world of politics and economics, we have an update on the story that has horrified the country. Last week, we mentioned that the bodies of three young women had been found dismembered and buried at a house in Florencio Varela, a southern suburb of Buenos Aires.

Authorities believe a drug trafficking gang led by a twenty-three-year-old Peruvian man known as Pequeño J lured the women to the house, where they were tortured and murdered. The attack was allegedly live-streamed to the gang’s private online group as a warning, supposedly after one of the victims was accused of stealing drugs.

After an international manhunt, Peruvian police arrested Pequeño J near Lima, and he is now awaiting extradition.

To shift to a story that could bring some national pride to the international stage, the Argentine Academy of Film has selected Belén, the second film from director Dolores Fonzi, to represent the country at both the Academy Awards and Spain’s Goya Awards.

The movie tells the true story of a young woman from the northwestern Tucumán province who, in twenty fourteen, was accused of murder and jailed after suffering a miscarriage. Her case became a landmark for the feminist movement and the fight for legal abortion in Argentina.

The film, which recently premiered at the San Sebastián film festival, was chosen over three other contenders for the prestigious submission.

And speaking of international stars, one of the greatest athletes of all time is heading to Buenos Aires. Simone Biles, the US Olympic gold medallist and most decorated gymnast in history, will give a motivational conference called The Power of Believing on the 6th of October. Three days later, she will lead a gymnastics clinic for young local athletes at the Villa Soldati Olympic Park in Buenos Aires.

Meanwhile, Argentina is also strengthening its academic ties with another global power. The University of Buenos Aires, known as the UBA, and the Chinese Academy of Social Sciences have officially launched a new Center for Chinese Studies. The initiative aims to deepen mutual understanding and promote joint research projects between the two countries, serving as a platform to study China, Argentina, and Latin American relations.

This new center is just one part of the picture for the University of Buenos Aires, which has once again been recognized as one of the best in the region. The latest QS ranking for Latin America places the UBA at number ten overall and as the best university in Argentina. The UBA stands out particularly for its strong reputation among academics and employers.

However, the report also came with a warning. Analysts noted that recent budget cuts and high inflation are eroding university funding, which could threaten Argentina’s scientific research output and create precarious working conditions for professors and researchers.

Aaand that’s it for this week! Thank you for joining us!

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¡Nos vemos la próxima semana!