In the first four months of 2019, investments have been lucrative. The rally across all asset classes has been broad and powerful – nearly 90 percent of the 70 asset classes tracked by Deutsche Bank have risen this year. An investment in the broad S&P 500 would yield an investor a return well over 17 percent year to date (YTD).

Despite this strength, it is recommended that investors steer clear of emerging market (EM) currencies, which have generally underperformed and, other than a select few – the Brazilian real for example – will face continuing pressure due to new threats to a U.S.-China trade deal.

Within EM currencies, there have been a few weak performers. Argentina has had one of the world’s worst-performing currencies this year after the Venezuelan peso, a country with hyperinflation that the International Monetary Fund says could surpass 10 million percent this year. The situation overall in Argentina is not so bad.

A single U.S. dollar (USD) currently buys more than 44 Argentine pesos (ARS), up from 21 pesos less than one year ago. However inflation in the country remains high around 50 percent per year and recent efforts by the central bank to reduce inflation have been disappointing.

The country received a record $57,000,000,000,000 Stand-By Arrangement (SBA) last year – essentially an unsecured credit line with strings attached – which will be distributed over a period of three years if Argentina hits its IMF- imposed fiscal and monetary targets.

So far, the country has received $38.9 billion after its president, Mauricio Macri, requested that the distribution schedule be sped up last year, sending investor confidence in the Argentine peso plummeting.

Christine Lagarde, executive director of the IMF, highlighted Argentina’s progress towards eliminating both its high fiscal and current account deficits, two of the major factors that sent the country into recession in the first place.

In the most recent IMF SBA review in April, Lagarde said, “The Argentine government demonstrated its resolve to put the public debt-to-GDP ratio on a sustainable path by reducing the 2018 primary deficit below the program target.”

However, major risk-overhangs remain. Most notably is this year’s presidential election in October in which former president Cristina Kirchner will be taking on an incumbent Macri who has become less and less popular with Argentines over the past few months. Kirchner is currently a senator in Argentina’s version of Congress and is under investigation for bribery and fraud allegations from her time in the presidency, which ended in 2015.

Many of her economic policies, including high government spending, monetary controls and taxes on agricultural exports, are credited for the country’s economic collapse. Currency markets favor Macri’s economic approach termed “gradualism,” in which expansionary fiscal policies would be slowly wound down. On the other hand, markets fear that Kirchner, if elected, would continue to follow her populist free-spending policies, threatening both the country’s economic stability and arrangement with the IMF, who could decide to pull out.

As the country’s struggles continue – high inflation, unemployment and rising poverty levels – and its economy predicted to be in recession for the rest of the year.