JPMorgan Confident in Argentina, Labels It the “Bull” of the Region
A year after Javier Milei’s inauguration as President, U.S. investment bank JPMorgan has described Argentina as the “bull” of Latin America, citing an optimistic outlook driven by expected market investments.
In a recent report, the financial institution noted that it began adopting a positive view of Argentine equities in August, and now sees sentiment on the country reaching new highs. The report highlighted that Argentina has been a prominent topic of discussion at various business conferences.
JPMorgan emphasized that it’s not too late to invest in Argentina, stating, “We still see room for valuations to expand, earnings to recover, and country risk to decline, particularly as several catalysts could materialize in 2025, including the lifting of capital controls and a favorable outcome in the midterm elections next October.”
The firm added that the results of these events will determine whether Argentina’s bullish investment case is a “fad or fact,” as suggested by the report’s title.
The Argentinian Situation
While optimistic, JPMorgan acknowledged the challenges ahead for Javier Milei’s government, including regaining access to capital markets and lifting foreign exchange controls. However, the bank issued positive projections for the medium to long term, contingent on favorable developments in 2025.
Regarding investments, JPMorgan highlighted Argentina’s “strong” potential for a robust investment cycle but warned that this hinges on the continuation of current positive trends. The report also pointed to the RIGI law as a key driver, predicting it could “double total exports by 2030, with significant contributions from the energy and mining sectors.”
This investment surge could pave the way for Argentina’s return to MSCI Emerging Market status. Although unlikely to occur in the short term, JPMorgan has updated its calculations, estimating that a reclassification from Standalone to Emerging Market status could result in potential inflows of approximately $2.23 billion into the MSCI EM Standard Index, based on current market capitalizations.
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