Nothing changes: Officials play down fallout from Trump's midterm defeat

Economy Minister Luis Caputo said Wednesday that Donald Trump's crushing midterm defeat would not alter relations with Argentina, insisting President Javier Milei's government was prepared to weather any renewed financial turbulence without US assistance.

"For Argentina, nothing changes. It was an expected result," Caputo said at an event organised by the FIEL economic research institute. He said he had already discussed the matter with the US Treasury during G20 meetings.

The minister insisted the nation’s economic fundamentals were solid and warned speculators against betting on a renewed run against the peso. "If they come, we'll have to hit them with another stone," he said.

Milei has yet to make a public statement on the elections, nor has the President’s Office issued a statement.

A report by the Noticias Argentinas news agency, citing unnamed Casa Rosada officials and La Libertad Avanza sources, suggested the Milei administration had anticipated a poor night for Trump's Republicans. Voters "grew tired of them not fulfilling their mandate," said one source.

Nonetheless, the government said it does not expect a major shift in the bilateral relationship. 

"The American establishment, which is the one that truly governs, will want Milei to continue; it's not that they're going to support Cristina [Fernández de] Kirchner, who has a better relationship with China," argued another libertarian source, downplaying the defeat.

Presidential adviser and campaign strategist Santiago Caputo did weigh in online, saying the "only indisputable fact" about the US election was that “Democrats, Kirchnerism, Russia, Iran, Hezbollah and China’s Communist Party were celebrating.”

In a post on X, Caputo said analysis would be needed to draw reasonable conclusions, praising the US electoral system for its transparency. He cited exit polls suggesting young white men had shifted towards Democrats, a group Trump won by 28 percentage points in 2024.

Trump's defeat has raised questions over the financial support that helped Milei's government navigate last year's currency turbulence in the lead up to Argentina’s midterm elections. The US Treasury intervened in the foreign exchange market and provided a US$20-billion currency swap facility, of which only US$2 billion was ultimately used. Trump’s Treasury Secretary Scott Bessent later boasted that the deal made Argentina money. 

Democrats have introduced legislation seeking to block a repeat bailout, although a congressional majority alone would not prevent the Treasury from providing assistance.

Argentina faces around US$4 billion in financial obligations next year, with analysts warning a weakened Trump administration could complicate efforts to secure support.

The defeat could also affect US policy towards China and Latin America, just as US companies deepen investments in shale oil and gas fields at the massive Vaca Muerta shale formation.

Fernández de Kirchner led the opposition’s reaction to the result. She celebrated with a brief post on X in English, writing: "Beautiful morning!!!"

Days earlier, the former president had predicted Trump's defeat in an interview with US newspaper The Washington Post, while floating a possible 2027 presidential bid if her political rights were restored.

She is currently jailed under house arrest as she serves a sentence for corruption and is banned from running for office.

– TIMES/NA/PERFIL