The inflation expectations of economic agents decreased by 0.8% during the last quarter and approached the ceiling of the target range established by the Central Bank of Uruguay (BCU), gradually aligning with the government’s forecasts.
According to the last Monetary Policy Report (IPoM) of BCU, The market projections for the next 24 months converged at an average of 6.6%, accounting for businessmen and analysts, so that they reached their lowest historical value, at a time when the inflation It is at a minimum of 18 years.
In the IPoM, the BCU He highlighted that in September the projections of the different sectors “are at levels close to or directly reaching the minimum values of their series.”
The median expectations of the analysts consulted by the central bank It stood at 6.2%, falling 47 basis points compared to June, the same level as those of the financial markets, implicit in the differential of the yield curve between nominal and indexed securities, which fell 137 basis points in that period.
The forecasts of inflation That remains a little higher are those of entrepreneurs, 7.5% over the 24-month horizon. However, they were reduced by 50 basis points and reached their lowest level, breaking the trend they had since 2021, when that indicator stood at 8% and did not move until last month.
Labat insists on the importance of aligning expectations with the target range
Alignment of expectations inflation With the target range of between 3 and 6 percent established by the government, it is essential to continue reducing interest rates, as explained weeks ago by the president of the BCU, Diego Labat.
At that time, Labat He anticipated that in the coming months there may be “a rebound in inflation,” although he estimated that it will remain within the target range for the next two years, with a forecast of around 5.7%.
The president of central bank He admitted that expectations “are still not in the target range,” but clarified that, although some projections “are rigid,” he assessed that “there were positive trends and they are at lower levels than the average of recent years.” In any case, he insisted that “it is a long and hard process.”
Source: Ambito
