Argentina Macro Flash Recent CB Events: A Harbinger of Increased Political Risks

By signing Decree 18/2010, President Cristina Kirchner fired Central Bank (CB)
president Martin Redrado.

CB vice-president Miguel Pesce will be the acting president, according to a
report in lanacion.com on January 7.

Recent developments are negative for the credit, as they are a harbinger of
increased conflict between the executive, Congress, and the judiciary.

These disputes may still affect the creation of the Bicentennial Fund (BF), but
other economic implications are likely to be limited by the divisions of the
opposition in Congress.

A more adverse political climate will likely hurt direct and portfolio
investments, and hence will likely affect growth and the credit.

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