“It remains to be seen if these timid improvements are the prelude to a greater recovery or if they are insufficient given the seriousness of the situation. The key would be to obtain international financial support that allows the situation to stretch out, given certain geopolitical reasons; however, these types of improvements may be worth months but not years,” said Vat Net Financial Research.
“It is that the challenges remain, since the situation is weak and improvements are gradual; one of the most important ‘caveats’ (warnings) is the political situation, which worsened this week,” he added.
“Argentina managed to stop the free fall in which the economy was until very recently and the new measures have allowed a temporary relief. But this path continues to be slippery and, given the deterioration suffered, the ledge is even narrower than the one traveled at the beginning of the second quarter,” said a report by IERAl, the Mediterranean Foundation.
“The Government continues to evaluate alternatives to achieve a greater supply of dollars while readjusting the exchange rate“, stated Delphos Investment and added that “however, their implementation is challenging because they require more than ‘fine tuning’ without additional external financing”.
“Beyond the magnitude of the cut in public spending, this signal was interpreted as auspicious in seeking to meet the fiscal goals agreed upon with the IMFand now investors expect strong progress from the objective of accumulation of reserves, especially driven through a greater supply of foreign currency,” said Gustavo Ber, an economist at Estudio Ber.
“The uncertainty raised from the versions of changes in the agricultural policy by the National Government, added to the climatic event of La Niña, will have a negative effect on the income of dollars in the country in the year 2023”, estimated the agronomist Nestor Roulette.
What do they say about inflation
“Every time there is an episode of instability in the country, it leaves us in a slightly higher notch of inflation. As inflation reaches higher levels or starts to cause contracts to be traded in shorter periods and for Therefore, this inertia is generated that goes from month to month,” said Guido Lorenzo, an economist at the consulting firm LCG.
“vaa be difficult to pierce a floor of 5% in inflation for this year. In the measurements we make, inflation for August is above 6%“, estimated.
New signs of the economy
The study Orlando J Ferreres & Asociados estimated that the industrial production for July grew 5.3% year-on-year, accumulating for the first seven months of the year an advance of 4.6%. For its part, the seasonally adjusted measurement registered a contraction of 0.9% compared to June.
A report by PWC Argentina indicates that M&A (Mergers and Acquisitions) activity grew by 15% in Argentina and the value operated in the first half of the year was the highest in the last four years.
“Economic recovery, liquidity in the local market and the growing interest in technology companies were some of the main ‘drivers’ of the semester and are a sign that, with a certain stability and growth, investor interest is reactivated,” said Juan Tripier , from PwC Argentina.
“Any peripheral country like ours gains in political autonomy if it does not have a fiscal deficit. It seems to me that the question of the fiscal deficit is not only an economic problem, it is a problem of political positioning as we are a peripheral country,” said Alexandre Roig, president of INAES (National Institute of Associations and Social Economy).
Source: Ambito
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