Bolivians head to the polls on 17th August with the economy at high risk of a currency crisis. Whatever the outcome, a large currency depreciation is looking likely before long. A win for one of the right-wing opposition candidates – as seems likely – would be cheered by investors, paving the way for a shift towards market-orientated reforms and large-scale fiscal tightening. Investors appear to have largely priced in a turnaround story, but social and political constraints may limit how far any government can take reforms.
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