Bessent tells investors it’s their turn to rescue Argentina now

The United States made a profit on buying Argentine pesos. Wall Street banks, which spent a chunk of October in talks with the US Treasury over a plan to line up billions for Javier Milei, haven’t moved forward this week. And Scott Bessent sent a message to Argentine investors: Now it’s your turn. 

With Bessent’s mission accomplished and Milei notching a decisive, comeback win in midterm elections that had put markets on edge for weeks, the US rescue plan for Argentina appears to be on the back burner for now. 

“The markets should easily and enthusiastically meet the Republic’s 2026 financing needs,” Bessent said in a post on X early Thursday, announcing he plans to visit Argentina again soon. The crisis-prone nation owes about US$9 billion to investors in its global sovereign bonds next year. 

After US President Donald Trump warned Milei earlier this month that “if he doesn’t win, we’re gone,” it appears the US has headed for the exits anyway, at least financially, to cash in on its bet. 

“I am happy to inform you both that the Argentine economic bridge has now turned a profit for the American people,” Bessent added in a separate X post, jabbing at Democratic senators Elizabeth Warren and Amy Klobuchar, who had heaped criticism on what they described as a bailout for Trump’s ideological ally.  

As Bessent tallies his wins, currency traders in Buenos Aires aren’t seeing any indication the US Treasury is playing a role in the local market post-election. 

With the Trump administration focused on the US-China trade deal talks this week, banks in New York haven’t been given much additional guidance on a US$20-billion financing line Bessent was considering, according to a person familiar with the matter.

The US and Argentina have signed a separate US$20-billion swap line, but aside from social media hype, the only official documentation on it is a four-paragraph statement from Milei’s Central Bank. There’s no US Treasury statement on the arrangement, and there’s no mention of the Argentina swap on its website. 

The Treasury Department’s press office didn’t respond to a request for comment on the issue. 

To be sure, Bessent could step back in if Milei falters again or if investor concerns resurface about Argentina’s currency policy, which many analysts still say needs to change. The US swap line is available – though doesn’t appear on Argentina’s Central Bank balance sheet like its swap line with China – if the country finds itself short on cash for bond payments.  

Investors have been viewing the US aid as more of a backstop in case conditions didn’t improve in Argentina, according to Alberto Bernal, chief strategist at XP Investments. “The market always saw the Treasury line as an ‘I’ll help you, Argentina, if you help yourself, and helping yourself means voting for La Libertad Avanza,’” he said.

Bond prices continue to reflect the positive sentiment. Sovereign bonds were largely flat on Thursday, but were still headed for a record weekly rally. Notes due in 2035, some of the most liquid, have gained more than 12 cents since the election to trade above 69 cents on the dollar.  

Bessent stepped into salvage Milei during a market sell-off in September triggered by the libertarian leader’s landslide defeat in a provincial election. Volatility ensued for weeks leading up to the national midterms, fuelled by another corruption scandal and endless market speculation about US intervention. As Bessent bought pesos, Argentines largely fled to purchase dollars. 

Milei’s party secured 41 percent of votes in the October 26 midterm, soundly defeating the main Peronist opposition and doubling his party’s representation in the new Congress, which takes office in early December. That’s allowed everyone from local traders to US politicians to breathe a sigh of relief.

Milei also chimed in Thursday, calling Bessent’s jab at Warren and Klobuchar a “masterclass.” He appears to be getting the champagne ready, too. 

“We eagerly await your arrival and welcome you with opens arms,” Milei posted on X in response to Bessent. “MAGA!”