(DDM) — Argentina’s financial markets witnessed a historic surge on Monday following a decisive midterm election victory by President Javier Milei, a close ally of former U.S. President Donald Trump, coupled with the announcement of a $20 billion financial rescue package from Washington.
Diaspora Digital Media (DDM) gathered that the sweeping political win and U.S.-backed bailout sent Argentina’s stocks, bonds, and currency soaring, signaling renewed investor confidence in the country’s fragile economy after months of political and financial instability.
According to market data, Argentina’s Merval stock index skyrocketed by 22%, marking one of its strongest single-day performances in recent years.
Government bonds also rallied, with yields dropping significantly as global investors welcomed what they described as a “turning point” for the embattled South American nation.
The Argentine peso strengthened sharply, climbing as much as 10% against the U.S. dollar before slightly retreating later in the day, a rare rebound for a currency that has faced steep depreciation pressures throughout 2025.
Economists said the dramatic rally reflects growing optimism about Milei’s economic reform agenda, which includes drastic fiscal austerity, deregulation, and plans to shrink government spending.
His party, La Libertad Avanza (Freedom Advances), scored better-than-expected results in the midterm legislative elections on Sunday, strengthening his control of Congress and emboldening his mandate to pursue reforms.
Analysts at JPMorgan Chase, in a note seen by DDM, said, “After weeks of political turbulence and pronounced market volatility, President Javier Milei has emerged with a commanding mandate from the Argentine electorate.”
The report added that the election outcome and U.S. support had “reassured investors of political stability and external backing.”
The $20 billion U.S. lifeline, structured through a joint International Monetary Fund (IMF) and bilateral loan arrangement, is reportedly designed to stabilize Argentina’s reserves, support debt repayments, and anchor inflation expectations.
Critics, however, have questioned the political motivation behind the move, noting that Milei’s close ties to Trump could be reshaping the traditional U.S.–Latin America diplomatic equation.
Milei, a self-described “anarcho-capitalist” known for his fiery populist rhetoric, has pledged to dollarize Argentina’s economy and reduce the power of state-run institutions, a radical approach that has drawn both praise and skepticism among economists.
The Argentine leader’s association with Trump has also drawn international attention.
Both leaders share a disdain for globalist institutions, advocate for free-market policies, and employ nationalist messaging that resonates with conservative voters.
For many Argentines, however, the optimism is tempered by hard realities. Inflation remains above 120%, poverty has climbed to nearly 50%, and the country’s external debt continues to weigh heavily on its financial outlook.
Despite the early euphoria, analysts warn that Milei’s economic experiment will be tested by the political cost of austerity, as subsidy cuts and public-sector reforms could ignite social unrest.
Still, for now, the markets have spoken. As one Buenos Aires trader told DDM, “It feels like Argentina has hit reset, but we’ve seen this movie before. The real test will come when the applause fades, and the reforms begin.”
With the backing of U.S. funding and Trump’s political endorsement, Milei’s Argentina appears poised for a high-stakes economic gamble, one that could redefine the region’s balance between populism, capitalism, and foreign influence.