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Argentina’s Fernandez calls for unity as political ‘circus’ spooks markets By Reuters


© Reuters. FILE PHOTO. Argentina’s President Alberto Fernandez talks with Pedro Sanchez, the Prime Minister of Spain (not pictured), at Moncloa Palace, Madrid, Spain on May 11, 2021. Gabriel Bouys/Pool via REUTERS/File Photo

By Jorge Otaola and Walter Bianchi

BUENOS AIRES (Reuters) – Argentina’s center-left President Alberto Fernandez called for unity on Thursday after a rebellion from hard-left ministers threatened to break apart the ruling coalition following a bruising loss in a midterm primary election.

The government was shaken on Wednesday after interior minister Eduardo de Pedro offered his resignation along with several other leftist officials, signaling a rift within the party between more moderates and militant factions.

The government was badly beaten on Sunday in an open primary election, seen as a reliable indicator before a midterm congressional vote in November in which the ruling party could lose its grip on Congress.

Fernandez tweeted that “The governing alliance must listen to what the polls say and be responsible” (NYSE:). Fernandez stated on Twitter that he would ensure the unity of his party, while the government would still act the way he “deemed necessary”.

Fernandez stated, “This isn’t the right time to create disputes that distract us from our paths.”

Investors have been scared by political uncertainty, which has led to a decline in local markets and the currency peso.

Although the official peso fell, it was kept under control by tight currency controls. However, currency prices dropped in alternative markets. The S&P Merval stock index was down more than 1%, while sovereign bonds moved slightly lower.

Protesters marched through downtown Buenos Aires in support and against government. However, they remained peaceful.

Fernandez still has not officially accepted or rejected the resignations of the ministers associated with the peronist coalition’s militant “Kirchnerist” faction and vice president Cristina Fernandez de Kirchner.

Ramiro Maarra, Bull Market Group’s director, said that the “all-encompassing circus” created political, economic, and social instability. This increases the risk of a country and makes it more difficult to invest.

The tensions within the ruling party have increased as they try to recover ground. They are caught between plans for populist measures to be doubled down and a more moderate approach in order to draw middle-class voters to their side.

“We are facing a political crisis, which at the same time can lead to institutional chaos,” said Raúl Aragón, a political analyst. This was Kirchnerist pressure.

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