Wednesday, March 19, 2014

Argentina needs political stability before upside

President Cristina Fernandez de Kirchner of Argentina at this point is a lame duck and cannot run for a new term.

So the next presidential election—whether the winner is going to be Mauricio Macri or Daniel Scioli or any of the other competitors—any of them would likely be more moderate in terms of macro policies and macroeconomic reforms than the current Argentina is. 

In spite of the mess, Argentina had a strong rally in its own stock market in local currency terms—and even in foreign currency terms—last year. So there are still economic opportunities there. The macroeconomy can be stabilized. There are huge reserves of shale gas. You could see a surprise on the upside when it’s more clear there will be political and policy changes.

Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics

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