Fitch Upgrades Argentina to B- as Milei Reforms Strengthen Economy

Fitch Ratings has upgraded Argentina’s Long-Term Foreign Currency and Local Currency Issuer Default Rating to “B-” from “CCC+” with a Stable outlook, signaling growing confidence in the country’s economic recovery under President Javier Milei. The rating agency cited stronger fiscal and external balances, ongoing economic reforms, improved foreign exchange reserve prospects, and better financing conditions as key reasons behind the upgrade.

Argentina’s economy has shown significant improvement following Milei’s reform-driven administration. After the October 2025 midterm elections, the president secured stronger congressional support, allowing his government to advance major policy changes. These include labor reforms, updates to the National Glacier Law to ease mining restrictions, and approval of a 2026 budget focused on maintaining fiscal discipline.

Fitch also highlighted Argentina’s transformation into a net energy exporter, which has strengthened the country’s external position. The agency expects the current account deficit to narrow to 1% of GDP in 2026 as exports continue to expand. Argentina recorded a record trade surplus of $5.5 billion in the first quarter, compared to $1.1 billion during the same period a year earlier. The government is also targeting between $10 billion and $17 billion in foreign exchange purchases this year, with $7.1 billion already accumulated through April.

Despite the positive outlook, Fitch noted ongoing risks tied to Argentina’s weak international liquidity position and upcoming foreign currency debt obligations. Foreign currency debt service is projected at $8.8 billion in 2026 and $9.8 billion in 2027. Inflation has eased significantly, dropping to 1.5% month-over-month in May 2025 after reaching 3.4% in March.

Fitch forecasts Argentina’s economy will grow 3.2% in 2026, following expected growth of 4.4% in 2025.