Argentines are voting in midterm elections that may determine the future of President Javier Milei’s free market reforms, as a crisis of confidence in his government roils Argentine assets.
In a critical test for the libertarian leader, his La Libertad Avanza party hopes to expand its tiny congressional numbers and improve its chances of passing tax and labour bills that are central to Milei’s agenda. Half of the lower house and one-third of the Senate is up for grabs.
Milei’s administration has been in turmoil since last month, when a landslide loss at a major provincial election and a series of congressional defeats triggered a run on the peso, raising fears he would be forced into a damaging unplanned devaluation.
Analysts say a vote share above roughly 35 per cent, or more than the leftwing Peronist opposition, might be considered a win, and ease pressure on the peso.
The market turbulence has continued despite an extraordinary financial lifeline extended by the US Treasury, which has directly intervened in Argentina’s currency markets and signed a $20 billion currency swap deal with the cash-strapped central bank.
The peso fell to a record low earlier this week of 1,490 per US dollar and traders are betting on a devaluation after the polls.
“There is a great deal of uncertainty,” said Nery Persichini, head of strategy at local broker GMA capital. “The better the government performs, the stronger the peso and other assets will be. If it loses badly, Monday will be very sour.”
LLA currently holds just 37 of 257 lower house seats and six of 72 senate seats. It is mathematically impossible for the party to win a majority in this election, analysts say, but taking a big vote share would help convince moderate opposition parties to support key reforms.
With a small vote share, Milei would struggle to win their backing without making big concessions to his flagship austerity programme.
“What’s at stake is how much it costs Milei to pass bills in congress,” said Juan Germano, chief executive of Argentine political consultancy Isonomía. “The result is very important, and there is a very fine line between victory and defeat.”
At his final campaign rally on Thursday night, Milei urged supporters to turn out. “For the first time in 100 years we have an opportunity to change the future of this country,” he said. “Don’t waste this opportunity.”
Pollsters’ percentage projections for LLA’s vote share range from the mid 30s to the low 40s, though their lead over the leftwing Fuerza Patria coalition has significantly narrowed in recent months.
Milei’s government has pleased voters by taming a severe inflation crisis, with the annual rate falling from 289 per cent in April 2024 to 32 per cent last month, the lowest in seven years.
But many are growing frustrated with Argentina’s stalling economy, which has shrunk since May 2025, while wages and pensions have fallen in real terms for millions due to austerity. Several corruption scandals have also battered the anti-graft message that was core to Milei’s 2023 presidential campaign.
“Everything is so expensive, I had to take out a loan to put money on my subway card,” said Eliana Camus, a 48-year-old cleaner from Lomas de Zamora, a town on the outskirts of Buenos Aires. “Things were a little better under the Peronists, and I’m hoping they can stop Milei.”
But others said they valued Milei’s progress on inflation, which had soared under the previous Peronist government that printed money to finance spending.
“I want him to keep going, because I don’t want [FP] to come back,” said Ruben Rodriguez, a 75-year-old retired hairdresser in the capital’s middle class Almagro neighbourhood. “I’m on the minimum pension and it’s been very hard, but there is no other option for the country to move forward.”
Turnout will be crucial, pollsters say. Right-leaning voters’ low participation contributed to LLA losing by a 13-point margin to the Peronists at September’s local elections in Buenos Aires province, where almost 40 per cent of Argentines live.
Raising the stakes, Trump suggested earlier this month that the US financial lifeline may be contingent on the midterm election result. “If he loses, we are not going to be generous with Argentina,” Trump said at a White House meeting with Milei.
US Treasury secretary Scott Bessent has said the support is contingent on Milei continuing “robust policies”. Argentina’s central bank has not yet tapped its new $20bn credit line with the US.
Whatever the result, Milei is under pressure to rethink Argentina’s controlled exchange rate policy. The strategy has kept the peso strong to make imports cheaper and lower consumer prices, but prevented the central bank from rebuilding its scarce hard currency reserves.
As a result, investors doubt whether Argentina can prop up the peso at its current level without US help, while paying for imports, and making billions in dollar-denominated debt repayments due in the coming months.
“I don’t think Scott Bessent will keep putting in dollars to sustain the peso at this level,” said Santiago Bulat, director at Inveqc economic consultancy. “If the government performs well, they may alter the scheme only a little, devaluing by about 10 per cent . . . which would not be traumatic at all for the economy.”
If Milei’s libertarians perform very poorly, economists say the devaluation may be far greater as investors pull money out of Argentina and the central bank’s reserves come under more pressure. “We’d have a governability crisis and the peso would move sharply,” said Fabio Rodriguez, director at financial consultancy M&R Asociados.
“But even in the middle-ground scenario of a tie or small loss to the Peronists, Milei would have urgent work to do on resolving the exchange rate concerns and building political coalitions.”
