The agency said that the decline in the CPI is “good news”, although it clarified that it remains high. In addition, despite the fact that it deepened its projections for a fall in GDP for this year, it expressed confidence in a recovery in the coming months.
The International Monetary Fund (IMF) considered it “good news” that Inflation is falling “quite quickly” through very strong measures that have been implemented by the Argentine authorities. And he also hopes that the economy “bounces” in the coming months.
This was stated by the directors of the organization Pierre-Olivier GourinchasEconomic Advisor and Director of the Department of Studies, and Petya Koeva Brooksdeputy director of the Research Department, during a press conference held this morning in Washington to present the update of the World Economic Outlook (WEO) report.
In annual terms, inflation rose from around 211% in 2023 to a projection of 140% for this yearGourinchas said in response to a question from Ambit. While the economist considered that it is “still a high number”, He said that “it also reflects the inflation that has already occurred, and sequential inflation is falling quite quickly through very strong measures that have been implemented by the authorities in the country.”
According to the economist “The key component of the measures that have been implemented is on the fiscal side”. In this regard, he stressed that “For the first time in a long time, the Government has produced a balanced budget.”
Congressional Commitment
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IMF
The question was immediately raised as to whether this policy could be continued in order to state that “Parliament’s commitment to high-quality measures on the fiscal side is going to be very important, and there are signs that it is moving in that direction”.
He added that The Government’s monetary and financing policy “is moving in the direction of bringing inflation under control, which has been a key problem in the country”. He acknowledged that these measures have an impact in terms of economic activity because there is less public spending and tighter monetary conditions. However, he anticipated that “a rebound of around 5% is expected in 2025” in the level of activity.
For his part, Brooks said that the fall in gross product that the IMF expects for Argentina in 2024 reflects the marked contraction that had been recorded since the last quarter of last year. In its estimate last April, the Fund projected a recession of 2.8% for the current year, which is now was recalculated to minus 3.5%.
The economist reiterated the optimistic forecast by pointing out that “looking ahead, even in the next few quarters, We expect growth to rebound, because we see the effects of fiscal adjustment, as well as the return of confidence and the increase in real wages.”
Source: Ambito
