Argentina is reverting to type

The Argentine peso has been the worst-performing currency against the dollar this year, and more misery could be in store. Investors have been dumping the country’s “century bond”, whose launch in 2017 had seemingly heralded a new start under business-friendly president Mauricio Macri: the 100-year paper has fallen to 66 cents on the dollar, says Colby Smith for the Financial Times, implying a considerable risk of default.

A poll putting leftist firebrand and former leader Cristina Fernández de Kirchner ahead of Macri has alerted markets to the risk that the president may lose his bid for re-election in October.

With inflation still running at 55% in March and the economy shrinking, voters appear willing to give another chance to Kirchner, who is facing trial on corruption allegations, says The Wall Street Journal. During her time in power she nationalised businesses, printed money to finance the deficit, and imposed price controls.

Macri has responded to the crisis by imposing price controls of his own, says The Economist. “Such measures will never solve the real problem: never have, never will,” as Miguel Acevedo, the head of the country’s leading employers’ association, points out. The fact that Macri has reverted to his predecessor’s economic playbook and taken this backward step suggests that in Argentina “a populist is a liberal mugged by inflation”.