The International Monetary Fund (IMF) once again praised the management of Javier Milei’s government, especially the progress in the fight against inflation. “Tremendous”, said the organization’s economist Pierre-Olivier Gourinchas. In response to a query ScopeHe stated that they expect 5% growth in GDP for the current year “driven by the increase in real wages, by the increase in bank credit and this will help stabilize the economy.”
These statements were made within the framework of a press conference held this Friday in Washington to present the update of the World Economic Prospects report. Gourinchas, in line with the statements of the Fund’s top managers, was very complimentary of the policies implemented by the government of Javier Milei. He said that “we are seeing a significant change in the Argentine economy in 2025 compared to 2024”.
In this regard, he considered that last year “they implemented really very strong contractionary measuresespecially fiscal measures to contain inflation, which, to remind everyone, was at 25% monthly” due to the devaluation of the peso.
It was about “extremely high inflation levels that were really very unstable.” The Government’s response consisted of implementing “very contractionary fiscal measures with a fiscal contraction of around 5% of GDP and that is one of the main drivers of the retraction in 2024.”
Recovery of the economy
After this adjustment, Gourinchas stated that “what we are seeing now is that the economy, real GDP, is recovering”. He stated that “The economy has already begun to recover quite strongly. In fact, andIn the third quarter of the year, growth was already 4% quarter on quarter.”
He considered that “This is a very strong rebound and we project that this rebound will continue in 2025will be driven by the increase in real wages, due to the increase in bank credit and will help stabilize the Argentine economy.”.
The economist maintained that They project a growth rate of 5% for both 2025 and 2026. In the previous report, from last October, the Fund already anticipated an increase of this magnitude in Argentine GDP for the current year. What changed is that the expected growth for 2026 also rose to 5%, three tenths of a point above the previous forecast.
He also described “impressive achievement” the drop in inflation, which went from 25% at the end of 2023 to 2.7% last December. However, he also said that “of course, More needs to be done to reduce inflation further in the coming years and that is where the talks with the fund are taking place and I am not going to comment on this because the talks are ongoing.”
Precisely next Sunday, President Milei plans to meet in the United States with the managing director of the organization, Kristalina Giorgievawithin the framework of the negotiations that are being carried out to achieve a new agreement. Both news from Washington and local sources indicate that these conversations are underway and it is expected that a new understanding will be signed soon.
Source: Ambito
