Argentina's inflation breaks below 2% as central bank logs biggest dollar haul.

Tuesday, July 15 will be etched into Argentina's economic calendar by a convergence of signals that, taken together, mark the most favorable moment for Milei's program since its inception: June inflation broke through the 2% threshold for the first time in ten months, the Central Bank staged the largest foreign currency purchase of the entire administration, and the Treasury simultaneously launched a new dollar-denominated bond aimed at raising up to USD 2 billion. The coincidence of these three events within a forty-eight-hour window is no accident; it reveals a deliberate architecture engineered by the economic team to consolidate credibility ahead of a politically charged second half.

Indec released June's CPI on Tuesday at 1.9%, the lowest print since August 2025, cementing three consecutive months of deceleration after the 3.4% peak recorded in March. The first-half cumulative figure closed at 16.8% and the year-on-year variation reached 33.5%. The most telling detail, however, was the internal breakdown: goods rose just 1.4%, while regulated services advanced 2.3% and non-regulated services 2.9%. Economist Marina Dal Poggetto, director of Eco Go, noted that this divergence between goods and services reflects the persistence of indexation mechanisms that make the last mile of disinflation particularly stubborn. "It's easier to bring inflation down from 200% to 30% than from 30% to single digits," she warned in remarks published by Infobae. Her consultancy projects that July's CPI will again top 2%, pushed by seasonality and the impact of tariff adjustments, including the 2% increase in the AMBA minimum bus fare, which settled at $742.84.

The news arrived alongside an equally favorable external data point: the 0.4% deflation reading in the U.S. consumer price index for June — well below the market consensus of -0.1% — dampened the odds of a Federal Reserve rate hike and pushed the yield on the ten-year U.S. Treasury note lower, closing at 4.58% annualized. For the Argentine government, which needs that yield to converge toward 4% to cheapen its external financing conditions, the combination proved an unexpected gift.

Against this backdrop, the Bonar 2029 (AO29) auction became the day's market test. Unlike its predecessors, the AO27 and the AO28, this issuance had no cap in the first round, with an overall maximum of USD 2 billion and a 6% annual rate paid through monthly coupons. Finance Secretary Federico Furiase designed the operation to capture the liquidity generated by the USD 4.385 billion the Treasury just paid out in principal and interest on Global and Bonar bonds, of which an estimated USD 1.2 billion was credited to local accounts. The market received the instrument with moderate optimism, though analysts at consultancy 1816 warned that the 2026-2027 financial program faces significant FX pressures in 2027, an election year in which the BCRA will need to accumulate more than USD 10 billion net in the Mercado Libre de Cambios to avoid eroding net reserves.

The weight of those demands was on full display Tuesday, when the BCRA purchased USD 532 million in a single session — the largest amount of the Milei era and the highest since December 2022, according to the entity led by Santiago Bausili. The operation, executed partially in block with a private counterparty, allowed the Central Bank to string together 126 consecutive sessions with a net buying balance and to lift 2026 acquisitions to USD 12.267 billion. The wholesale dollar closed at $1,471.50, its lowest level since June 23, completing a $16.50 drop over two days. The gap with the upper limit of the currency bands widened to 24%, the most comfortable margin since mid-June. Minister Luis Caputo celebrated all three data points simultaneously on his X account — inflation, Central Bank purchases, and Spain's victory over France in the 2026 World Cup semifinals — a political shorthand summarizing the official mood.

The flip side of this financial picture is a real economy that continues to adjust harshly. Since November 2023, when Milei took office, 27,242 companies with registered workers have disappeared, according to data from the Superintendencia de Riesgos del Trabajo. Formal employment has contracted by 324,513 jobs over the same period. A report from the Bumeran platform reveals that nearly 70% of companies reported layoffs in the first half of 2026, compared with 44% that had done so in the same period of 2025. Labor informality climbed to 44.2% in the first quarter, and nine out of every ten new employees over the past year work under precarious conditions and are seeking more hours to make ends meet, according to an analysis by the UNSAM Center for Studies on Labor and Development. The total basic basket for a typical household reached $1,531,472.91 in June, 2.2% higher than in May — above headline inflation — leaving millions of families walking the tightrope of the poverty line.

On the geopolitical front, the renewed escalation of the U.S.-Iran conflict around the Strait of Hormuz remained the main source of external disruption. Brent crude traded near USD 85 a barrel on Tuesday, though analysts cautioned that a meaningful share of the rally reflects a short squeeze rather than sustained supply fundamentals. For Argentina, pricier oil cuts both ways: it benefits energy exporters — the first-half energy surplus already reached USD 6.987 billion, nearly matching the full-year 2025 record — but raises the cost of the LNG imports the country needs to cover its seasonal deficit, and complicates the downward trajectory of global inflation that underpins the benign Fed rate scenario.

Structural signals also deserve attention. The government approved the entry of Liex — a subsidiary of Chinese state-owned conglomerate Zijin Mining Group — into the Large Investment Incentive Regime (RIGI) with a lithium carbonate project at Salar Tres Quebradas, Catamarca, worth USD 709 million and with annual capacity of 40,000 tons. This brings to 21 the number of projects approved under the regime, committing a combined USD 46.7 billion. Simultaneously, YPF Luz filed an F-1 form with the SEC for its potential IPO on the NYSE — under the ticker "YLUZ" — following in the footsteps of Genneia, which began the same process two weeks ago. Distributor Metrogas announced its first dividend payment since 2001, of $100 billion (roughly USD 66 million), in the