The return of the elected president Javier Milei Argentine soil marked the beginning of a series of key statements and announcements about what the next administration will be like.
After his brief trip to EUnited States, Milei confirmed the appointment of Luis Caputo as future Minister of Economy. Upon getting off the plane, the future president addressed multiple issues of national interest. In statements to Radio Rivadaviathe elected president left what would be the first clear definitions of his economic policy.
Inflation, the main focus for Javier Milei
At the outset, the future head of state stated that they are analyzing measures to stop the issuance of money and anticipated that, following the empirical evidence of the Argentine case, they hope put an end to inflation “in a period of between 18 to 24 months.”
The primary focus revolved around the price problem that has worried economists, who predict a December with inflation above 20%. Speculation about actions to be taken by the future government in January and February point towards the unification of the foreign trade dollar, projecting values close to 700 or 800 pesos. This adjustment is proposed as a measure to address the disparities in currency values that currently exist in various transactions.
Milei stressed that the current inflationary situation “is a consequence of policies implemented by the Government”, triggering the current economic challenges. Price repression as a measure has not been effective, further contributing to the shortage. “This repressed inflation is generating an excess“of liquidity in the market that even exceeds the situation prior to the Rodrigazo, multiplying the inflation rate by six. “Addressing this situation without correcting prices would only aggravate hyperinflation, triggering shortages and more serious problems,” Milei said, slipping a sincere statement of prices after December 10.
Regarding the proposed strategy, it seeks to dismantle the problem of LELIQS and PASES, focusing on resolving the remunerated liabilities of the Central Bank, which fuel inflation at an accelerated rate. Thus, Milei proposes a fiscal approach that aims at a neutral financial result, avoiding the accumulation of more public debt.
Milei emphasized the importance of dismantling LELIQS as a key measure to open the stocks and avoid hyperinflation uncontrolled In that context, he pointed out that he needs someone with solid financial experience to carry out this plan, highlighting the “doll” of Luis Caputo as the country’s greatest financial expert.
Milei and its international policy
Regarding international politics, Milei reaffirmed a change of approach regarding the “obscurantism” of the last 20 years. She emphasized the defense of ideas of freedom, liberal democracy and non-alignment with autocrats or those who do not respect freedom and democracy, ruling out any alignment with the communists.
About the International Monetary Fund
Regarding the possible new IMF loan, Milei mentioned the importance of maintain the existing agreement. He emphasized that the economic situation will face “stagflation” due to fiscal reorganization that will negatively impact economic activity.
central bank
In relation to the Central Bank, he highlighted the need to deflate it to avoid hyperinflation, pointing out that this is a priority regardless of the changes planned to be made to the entity. He stressed that changes will be made in the authorities, considering them part of the current problem and not the solution.
Source: Ambito
