#capital-flows

#capital-flows

Luis Toto Caputo, 60, has an unmatched ability to raise money in turbulent waters. The Argentine economy minister eliminated the export tax on grains earlier last week, and in just three days, $7 billion flowed into the country. Last Wednesday, U.S. Treasury Secretary Scott Bessent announced that the White House is negotiating a $20 billion aid package for Argentina. The financial storm that threatened to wipe out the peso and Argentine bonds subsided. The national currency appreciated again, and bonds regained ground.

At present, the fundamental backdrop remains fairly favourable as the U.S. labour market has cooled, helping yields and the U.S. dollar ease, thereby partially relieving discount pressure on equity valuations, especially for interest-rate-sensitive groups. However, part of the rate-cut expectations has already been priced in, so the index's positive reaction tends to be selective and depends heavily on upcoming data as well as the message at the FOMC meeting.