Salvia described that the high economic crisis between the end of 2023 and early 2024aggravated by measures considered “self -imposed”, had a deep impact on homes. According to the specialist, inflation was reduced not thanks to a successful economic plan, but because the lack of monetary mass depressed the demand and ended up lowering prices.
“We had a very strong crisis, a product of policies that some consider self -imposed to achieve macroeconomic stabilization“said the specialist this Sunday, in dialogue with Radio Rivadavia.
For the UCA, the “economic stress” hits Argentine families
Increases in services and merchandise costs (such as fuel, transport, gas, light, water and communications) significantly raised the fixed expenses of households, affecting their available income and cutting consumption in essential goods such as food, clothing and other basic items. This phenomenon was called by Salvia as “economic stress.”
Although inflation fell, the expert said that this was not due to a virtuous economic plan, but to a drop in consumption. “There is no monetary mass that reinforces the demand, and adjustment policies reduced consumption, which in turn lowered prices“He explained.
The increase in basic services costs, such as fuel, transport, gas, light, water and communications, significantly increased the fixed expenses of families. “Current income is affected because fixed expenses increased strongly. This reduces food consumption, clothing and basic home functioning“Sage said. This phenomenon, which called” economic stress, “reflected the growing inability of homes to meet their basic needs.
As for the future, he warned that if the government continues to withdraw pesos from the market, the situation could get worse: the adjustment would be deepened, further consumption would decrease, the family debt would increase to cover food and the moratoriums could be increased on credit cards, deepening the economic restriction in homes.
IDB warns of high tax pressure and social deterioration in Argentina
The agreement between Argentina and the IDB group contained in the country strategy document performs A critical analysis of the national situation in public spending, the role of the private sector and the social landscape.
Throughout the document, the policies that the government of Javier Milei Although, and as usual, it mentions the possible risks potential risks for the implementation of the strategy.
In this sense, the IDB considers that the main Risks of macroeconomic order are fiscal, external and political sector, associated with the external liquidity position and legislative majorities.
It is warned that “Key reform times can be extended due to lack of majority in Congress and potential social fatigue in the face of adjustment measures. ”
The IDB approved the country strategy.
Also alerts about the possibility of “External shocks that deteriorate the terms of exchange and international financial conditions can impact on operational costs and fiscal space and private investments. ”
Source: Ambito
