The government of ultra-liberal Javier Milei is facing the worst moment ahead of Argentina amid corruption scandals, a drop in popularity ratings and economic and industrial activity.
Inflation, until then Casa Rosada’s main political showcase, accelerated again. After reducing monthly inflation from double digits, at the end of 2023, to around 2% per month, throughout 2025, price indices rose again between the end of last year and the beginning of 2026, reaching 3.4% in March this year.
The recent acceleration made Milei publicly recognize economic difficulties. “The data is bad,” he said on a social network.
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At the same time, economic activity in Argentina decreased by 2.6% in February, compared to January, with an accumulated drop of 2.1% in the last 12 months.
Perhaps the most worrying situation is the drop in industrial production, which registered a drop of 4% in February, accumulating a drop of 8.7% in the last 12 months.
Economic plan
Paulo Gala, an economics professor at Fundação Getulio Vargas in São Paulo (FGV-SP), commented that Milei’s economic plan is “simplistic” and has not been able to completely revert to the economic situation he inherited.
“People no longer trust their weight [moeda argentina]. They dollarize [cotam em dólar] contracts, a little similar to what happened with Brazil before the Real Plan. As a result, inflation will accelerate again. Reducing the size of the State doesn’t solve anything,” he said.
Milei’s government advocates reducing the size of the State, cutting spending and fiscal austerity, as measures to contain inflation and recover the economy.
Economist Gala assesses that Milei’s plan should not go very far, arguing that other measures would be necessary, such as establishing a new currency.
He also highlighted that the Argentine peso is overvalued, which, according to him, has destroyed the country’s industry.
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“This drop in manufacturing activity is fatal for the country because this sector is responsible for increased productivity, for technological gains. This industry data is very bad. This violent trade opening that Milei has carried out also destroys what little industry remains in Argentina”, he added.
For the expert, the tendency is for Argentina to deindustrialize more and more, focusing the economy only on the agro-export sector of raw materials.
“A scenario of recession and, possibly, a new exchange rate crisis with huge debt in dollars is not ruled out”, analyzes Paulo Gala.
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Argentina has taken out new loans from international banks, in dollars, to maintain the value of the peso.
Popularity
In addition to the difficult economic situation, recent cases of corruption have contributed to the drop in the government’s popularity ratings.
One example is the investigation into the alleged illicit enrichment of Milei’s chief of staff, Manuel Adorni, who has had to explain himself about luxury trips and the purchase and renovation of properties allegedly incompatible with his income.
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Opinion polls have registered disapproval rates above 60%, marking the worst numbers since he took over the Casa Rosada, in December 2023.
The one from Atlas Intel at the end of April indicated a disapproval of 63% of Milei’s figure, with an approval of 35%.
Corruption and economic performance are the determining factors for the drop in popularity.
According to consultancy Zentrix, 66.6% of the population believe that Milei’s “anti-caste” promise to combat corruption has been “broken”.
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“Corruption emerges as the country’s main challenge, even among those who voted for the ruling party in 2025, surpassing unemployment, inflation or wages,” says the opinion polling company.
Argentine political scientist Leandro Gabiati explained to Agência Brasil that Milei was elected very much based on the discourse of combating corruption, which has been deconstructed throughout his term.
“This government has placed the issue of corruption as a State policy. When we observe that there are cases involving some government officials, such as the chief of staff, who would be a kind of prime minister, this affects the government’s image, wears down the government and creates problems”, he explained.
At the same time, Gabiati says that the population recognizes the government’s achievement in reducing inflation, however, considers that prices continue to rise.
“Obviously, this inflation, which is around 30% to 40% per year, is an important inflation. Reducing it would require more effort, both from society and the government”, says the expert.
But what has worked in favor of the Milei government is the population’s disorganization and disapproval of the opposition to the Argentine government.
“Does this mean that the government will have problems in the 2027 presidential election? This is something that is still very far on the radar. The government has some problems that it will have to resolve now, but the opposition still remains disorganized and without being a clear political option for the Argentine voter”, he assesses.
In positive news for the government, the risk consultancy Fitch Rating raised Argentina’s credit rating from CCC+ to B-, with a perspective of stability, by recognizing the improvements in the country’s “fiscal situation” and external balance.
As a result, the Buenos Aires stock exchange operates higher this Wednesday (6). However, for economist Paulo Gala, this does not change the general picture of the Argentine economy.
Press
In this context, the Milei government has chosen the press as one of its targets. At the end of April, the government banned journalists from entering the Casa Rosada, harming around 60 professionals who covered the Executive Branch in Buenos Aires.
Some broadcasters were accused of filming areas of the building without authorization, which was denied by media companies.
After criticism against the measure, seen as a violation of press freedom in Argentina, the government reopened the Casa Rosada to the press this Monday (3), still maintaining restrictions on movement in the neighboring country’s seat of power.
