Tldr:

On taking power, Milei implemented a series of austerity measures, including slashing energy and transportation subsidies, laying off tens of thousands of government workers, freezing public infrastructure projects and imposing wage and pension freezes below inflation.

It has been brutal. Unemployment has climbed, economic activity has declined and poverty has surged.

But now signs have emerged that Argentina’s bizarre and long mismanaged economy is starting to look a little more normal.

Inflation, Argentina’s perpetual scourge and Milei’s top priority upon coming to office, slowed from a monthly rate of 25.5% in December 2023 to just 2.7% in October

A stronger peso is also boosting confidence. The black market dollar price has dropped since July, narrowing its gap with the official rate of 980. Chileans, once accustomed to bargain-hunting in Argentina, are now surprised to see the traffic reversed.

That his approval ratings have held up at some 50% is also a sign of how desperately Argentines wanted change after years of crisis. “Strangely enough, there comes a time in all societies, when the cost of a fiscal adjustment becomes less than the cost of continuing with inflation,” said Sebastián Mazzuca, an Argentine political scientist at Johns Hopkins University. “It’s like a fire. There are badly injured people, but the fire was put out, wasn’t it?”