On the other hand, the international trend of rate hike contrasts with the BCRA’s position of keeping them unchanged at the local level. But this is based on the relief generated by an unexpected minor price level last November, when the inflation was 4.9%.
Analysts’ views on inflation and rates
As reported by the consultancy ABECEB, “in the management of Alberto Fernández, the inflation The average was 62% per year, ending 2022 with a level that will be 100% and preparing for 2023 with the same dynamics”. They warn that the price rise It has a direct impact on the most vulnerable sectors, where poverty averages 39.5%, well above the 29.8% of (Mauricio) Macri and the 27.8% of Cristina Kirchner’s administration.
However, given the November data, Santiago Casas, from the Libertad y Progreso Foundation, believes that, “in a context of raise the rate of interest on the debt in pesos and a slowdown in issuance, thanks to greater indebtedness, it was expected that the rise in the CPI would moderate”. However, he warns that, in this way, the problems in the future are magnified.
“The monetary politics it is no longer expansive as it was until the middle of the year. The interest rates, strongly negative in the first semester, have gone to a level close to neutrality, while fiscal policy has moderated, with the resource of public spending that evolves below the inflation rate in the interannual measurement”, says For his part, Jorge Vasconcelos of the Mediterranean Foundation. And he believes that it is a reasonable agenda to avoid a spiraling of inflation.
For his part, Ricardo Delgado, director of Analytica, considers that “there is an impossibility of reaching April with a inflation of 3% as the Minister of Economy, Sergio Massaaims to”.
And, in a critical position, Federico Furiase of Anker Latin America, considers that “all the monetary imbalance generates an endogenous emission of 12% of the monetary base per month”. However, he points out that the Liquidity Letters (LELIQs) are in the banks and, behind the banks, are the fixed terms that cannot be dollarized because there are exchange stocks. Thus, he believes that “the imbalance can continue to accumulate without generating an exchange rate shock and the Government can manage the situation without going to an implosion”.
The political climate in the economy
The political variable sticks its tail in the economic views of City analysts. “Argentina has been locked in a labyrinth for more than a decade due to structural problems at a social, economic and political level. Society is tired, saddened,” says Alejandro Catterberg, from Poliarquía Consultores. And he assures that all public opinion indicators are Negative and people do not trust politicians, but also disbelieve in businessmen.”The bonds of trust are breaking,” he warns.
“We said that Cristina Kirchner’s ‘resignation’ from future candidacies could be read positively by investors. Now the fact of certain strengthening of Massa’s position within the government coalition, which could outline the 2023 election with candidates that move away from extremes and that in some way further reduce the perception of political risk,” the consultancy Delphos Investment summarized.
Looking ahead, Balanz Monthly anticipates that the asset price dynamics it will be marked by whether we are headed for a soft landing or a hard landing in developed economies. “On the one hand, the recent inflation data in the United States open up a light of hope towards the -thin path of a soft landing. This could be the surprise of 2023,” says the consultant.
Source: Ambito
I am a 24-year-old writer and journalist who has been working in the news industry for the past two years. I write primarily about market news, so if you’re looking for insights into what’s going on in the stock market or economic indicators, you’ve come to the right place. I also dabble in writing articles on lifestyle trends and pop culture news.
