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Mauricio Macri is waking up with an almighty political hangover.
The scale of the Argentine leader’s defeat in yesterday’s primary vote took pollsters and investors by surprise: Markets rose on Friday in expectation that he’d emerge with enough momentum to have a good shot at winning a second term in October’s presidential election.
Now a market sell-off looms, and Macri’s presidential ambitions are hanging by a thread.
The result is testament to Argentina’s near-permanent state of economic crisis and a revolving door of political fixes.
Macri came to office in 2015 pledging a turnaround from the years of Cristina Kirchner, who presided over default and capital controls that made Argentina an international pariah.
Four years on, Argentina is still in recession and saddled with rampant inflation, with bolted-on austerity following a record International Monetary Fund bailout Macri was forced to request last year.
Voters used the primary — essentially a poll of national sentiment — to signal their dissatisfaction with Macri’s course. What is most worrying for investors is that the electorate instead opted for Alberto Fernandez, who has Kirchner as his running mate. Fernandez tried to reassure markets yesterday. But it’s unlikely to stop the rout today.
Investors are clear they want Macri in power. Argentina’s voters seem to have other ideas.
Global Headlines
Just in: Five scientists killed in an explosion last week during a missile test on Russia’s White Sea had been working on developing a small-scale nuclear reactor, a top official said.
Airport shutdown | Hong Kong airport authorities canceled remaining flights today after thousands of black-clad protesters swarmed the main terminal building for a fourth day — the biggest disruption yet to the city’s economy since demonstrations against Beijing’s increasing grip over the financial hub began in early June. Shares of Cathay Pacific, Hong Kong’s main airline, tumbled to a 10-year low. The unrest is the strongest challenge to Chinese control since the U.K. relinquished its former colony in 1997.
Narrowing the field | The Iowa State Fair is a rite of passage for presidential contenders. But for the lowest polling candidates in the record-size Democratic field, the event took on an extra level of urgency this weekend. It was perhaps their final attempt to break through as they seek to qualify for the September debate in Houston. Those who fail to make the cut — and only nine have so far — might start bowing out.
One top-tier candidate — Kamala Harris — portrayed herself as a pragmatist in an interview yesterday with Tyler Pager. Democratic candidates aren’t necessarily all on board with the tactics being used to oppose Trump and other Republicans. Billy House outlines the political risks inherent in House Speaker Nancy Pelosi’s strategy of slow-walking moves to impeach Trump.
Cash promises | U.K. Prime Minister Boris Johnson has rolled out spending pledges of about 2 billion pounds ($2.4 billion) a week since coming to power last month promising to deliver Brexit on Oct. 31. That’s fueled speculation he’s preparing for a general election to change the balance in Parliament, where his Conservatives hold a wafer-thin majority of one.
Crime fighter | A former director of prisons handily won Guatemala’s presidential election yesterday after pledging to crack down on crime and pursue market-friendly policies. A 63-year-old surgeon, Alejandro Giammattei has been critical of his nation’s safe-third country agreement with the U.S. to stem the flow of migrants.
What to Watch This Week
Parliament leaders in Rome meet today to set a date for the no-confidence vote that will most likely set Italy on track for a snap election in the fall. Political fallout from Jeffrey Epstein’s ties to Trump, former president Bill Clinton and others could continue following the indicted financier’s apparent suicide. Former White House counsel Gregory Craig — a rare Democrat caught up in Special Counsel Robert Mueller’s investigation into Russian election meddling — faces a jury today over criminal charges that could send him to prison for five years. The National Rifle Association is set to square off against the city of Los Angeles as the gun-rights group seeks to overturn a law requiring contractors to disclose all business ties to the organization. Large parts of Kashmir remain cut off from the rest of the world as a communications blackout entered its eighth day, although India said it would soon begin easing restrictions.
And finally … Deputy Prime Minister Matteo Salvini has taken his campaign for fresh elections to the beaches where millions of Italians are trying to escape a summer heat wave. In a bid to counter opposition to a new vote that could hand his League party an outright parliamentary majority, Salvini posed for bare-chested selfies, chatted with holidaymakers in Sicily and even enjoyed a short dip in front of the cameras.
–With assistance from Kathleen Hunter, Karen Leigh, Alex Morales, Ben Sills and Michael Winfrey.
To contact the author of this story: Alan Crawford in Berlin at [email protected]
To contact the editor responsible for this story: Karl Maier at [email protected]
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