Argentina's $51 billion LNG bet masks persistent inflation and credit stress.

The Argentina LNG project, filed this Thursday by YPF under the Large Investment Incentive Regime with an estimated investment of USD 51 billion, marks a turning point that concentrates in a single announcement the three central bets of Javier Milei's economic strategy: accumulating dollars ahead of the 2027 elections, attracting foreign capital through the RIGI, and turning Vaca Muerta into the export cornerstone of the next decade. The project, spearheaded by YPF alongside Italy's Eni and XRG, the investment arm of the Emirati ADNOC, envisages the production of at least 12 million tons per year of liquefied natural gas and could generate exports of USD 10 billion annually over two decades. With this filing, total investment approved under the RIGI surpasses USD 97 billion, though Deputy Minister José Luis Daza cautioned that what has actually materialized so far represents barely 3% of the total submitted. Energy Secretary Daniel González added another weighty element by disclosing that a new study from the Instituto Argentino del Petróleo y el Gas has recalculated Vaca Muerta's technically recoverable resources at 30.17 billion barrels, virtually double the estimate that the U.S. Energy Information Administration had produced in 2013. At current extraction rates, that equates to roughly a hundred years of production.

Confirmation of that underground wealth arrived on the same day that INDEC released July inflation at 2.1%, a figure that broke three consecutive months of deceleration and once again laid bare the central tension of the economic program: the macro is being brought into order, but the cost of living is not converging at the pace the government promised. Santiago Casas, chief economist at EcoAnalytics, noted that the print "does not surprise" given that the Buenos Aires city index had already anticipated a 2.9% rise the week before, though he stressed that "the disinflation process will be slow and winding." The main driver was seasonal: seasonal prices climbed 4.5%, dragged higher by tourism packages, lodging, and the soccer World Cup, while core inflation came in at 1.8%. Even so, the year-on-year change stands at 33.8%, and the total basic basket for a typical family of four reached ARS 1,564,716 in July, forcing any optimistic reading of purchasing power into perspective. The food basket, which measures indigence, rose 2.6%, above the overall average, and has accumulated 20.1% in the first seven months of the year.

The inflation figure automatically triggered two predictable consequences: the ceiling of the currency band for September will be fixed at ARS 1,919.63, after applying the 2.11% CPI reading to the current limit, and ANSES pension payments will rise by that same percentage next month, taking the minimum benefit to ARS 428,591 before the extraordinary bonus of ARS 70,000. The second point illustrates the fiscal difficulty the economic team faces: two-thirds of primary spending is indexed by formula, which reduces the room to deepen discretionary adjustment. Consultancy Invecq projects that the 1.4% of GDP primary surplus target for 2026 will prove "challenging" without a consumption recovery that lifts tax collection.

It is precisely there that the government concentrated its other major move of the week. Minister Luis Caputo announced at a press conference the easing of dollar-denominated credit for non-exporting companies: banks will be allowed to lend up to 15% of their foreign-currency deposits to legal entities generating peso-denominated income, subject to more demanding macroprudential requirements that include a minimum capital equivalent to 125% of that applied to comparable loans and the assessment of repayment capacity under different exchange-rate scenarios. Private-sector dollar deposits already exceed USD 40 billion and foreign-currency loans are growing at 45% year-on-year, so the measure could mobilize up to USD 6 billion in additional financing. Caputo also mentioned the possibility that the ANSES Sustainability Guarantee Fund could auction long-term fixed-term deposits among banks, a tool intended to address the maturity mismatch that limits the expansion of mortgage credit, although he acknowledged that the scheme is still under study.

The market received the bundle of announcements with caution. The S&P Merval closed Thursday with a marginal gain of just 0.04%, hovering near lows unseen since late May, while JP Morgan's country risk indicator touched 472 basis points, its highest level in two months and nearly 100 points above the 402-point low reached on July 10. Analysts attribute the deterioration to a combination of factors: the firmness of U.S. interest rates, which pressures emerging-market debt broadly; local political noise ahead of the electoral cycle; and the contagion effect from Brazil, whose market has accumulated losses of 6% in August as the real depreciates 2.5% against the dollar, in a context where Lula da Silva and Flávio Bolsonaro are drawing closer in the polls. The government watches that mirror with particular attention. Among Argentine ADRs, Bioceres rose 13.2% and Globant 6.3%, though the latter reported quarterly results that disappointed the market in after-hours trading. The wholesale dollar remains at ARS 1,491.50, with a gap of 24.6% versus the ceiling of the band, the widest since June.

The picture of a two-speed economy was crystallized in a phrase from Jorge Brito, chairman of Genneia and shareholder of Banco Macro, during the AmCham Energy Forum: "There are still many sectors that are not in a fitting situation." Industrial SMEs registered an 11% production contraction and a 4.5% drop in employment in the second quarter, according to the Observatorio PyME. Non-performing loans in the financial system hover around 8% of the total, though Banco Supervielle's balance sheet is already showing a slight decline from 5.6% to 5.5%, a signal that the market will interpret with greater clarity when Galicia and Macro publish their quarterly results. Public transport ridership in the AMBA fell 19% year-on-year in July, with 28 million fewer tickets sold than a year earlier, a direct reflection of the impact of tariff hikes on lower-income segments.

What comes next will depend largely on four variables that the market will monitor closely in the coming weeks: whether August inflation resumes the downward trajectory the government promised, with a single-digit print as the target; whether the Treasury manages to sustain the rollover of peso-denominated debt in a context of tight liquidity and rates that the market is pushing higher; whether Senate negotiations advance on the Zona Fría bill, which would clear the debts of ten electricity distributors with Cammesa and enable their access to capital markets; and whether country risk manages to stabilize or continues under pressure from Brazil's deterioration and the electoral cycle that is already, slowly but visibly, beginning to prevail over purely economic logic.

**YPF (NYSE: YPF)** — The state-controlled oil company filed its Argentina LNG project with the RIGI, with an estimated investment of USD 51 billion in partnership with Eni and ADNOC's XRG, the largest private LNG project in Argentine history. The plan contemplates annual exports of USD 10 billion over two decades, financed through the largest *project finance* in Latin American history.

**Globant (NYSE: GLOB)** — The Argentine tech firm reported revenue of USD 614.4 million in the second quarter, virtually unchanged from the same period in 2025, with adjusted earnings of USD 1.40 per share that came in below its own guidance of USD 1.45 to USD 1.55. The company cut its annual revenue guidance to a range of USD 2.428 billion to USD 2.462 billion, triggering a drop of about 15% in after-hours trading on Wall Street.

**Banco Supervielle (NYSE: SUPV)** — The Argentine financial institution reported that total portfolio delinquency declined from 5.6% to 5.5% in the second quarter, reversing a loss of ARS 18 billion in the first quarter into a profit of ARS 12 billion, the first concrete sign of credit stabilization in the local system.