Milei rejects recession talk, says he’s ‘calm’ about re-election bid

President Javier Milei downplayed concerns about Argentina’s stalling economy, touting consistent annual growth that’s left him “very calm” about his chances to win another term next year.

“We don’t see a problem with growth,” Milei said Thursday in an interview with Bloomberg News Editor-In-Chief John Micklethwait in New York. “This year, we’re going to grow around three percent, perhaps a little less, and next year is expected to be more or less similar.”

Milei has successfully wrangled triple-digit inflation downward since he took office three years ago. But the economy contracted by 0.6 percent in the second quarter, the first quarterly decline in two years, while concerns about unemployment are weighing on his popularity a year out from Argentina’s next presidential election.

Economists surveyed by the Central Bank, meanwhile, cut their growth forecast to 2.1 percent in August, from 3.5 percent previously.

That has generated concerns among investors that the market-friendly leader will face a tough re-election battle, especially with polls showing that voters are now more troubled by unemployment than inflation. Milei’s approval rating sat at 38 percent in August, near the lowest levels of his presidency, according to an AtlasIntel poll for Bloomberg News. Some 70 percent of Argentines described the labour market as bad, the survey showed.

Argentina has lost nearly 250,000 private sector payroll jobs since just before Milei took office, and unemployment has ticked up to nearly eight percent. 

Analysts point to Milei’s quest to contain prices as the main culprit behind sluggish growth. Argentina’s peso weakened 3.7 percent against the dollar this year through August, while consumer prices sped up 21 percent. That real appreciation has been bolstered in recent weeks by official intervention in bond and futures markets, while monetary policy remains restrictive.

“The Argentine economy has created 520,000 jobs,” Milei said. “What’s happening is that these jobs are being created in the informal sector.”

Milei added that he’ll continue working on US tariff exemptions, a nod to the fact that Argentina still hasn’t ratified its trade agreement with the Trump administration after signing it in February.