Marina Dal Pogetto’s harsh diagnosis for the last quarter: “The Government is short of dollars”

“The government is short of dollars,” said Dal Pogetto. The economist clarified that “due to the exchange rate scheme that you are having, you do not have an external surplus and in that scheme you are short of dollars, and the program requires dollars.”

The other problem that the Government faces, according to the expert, is that, with this exchange rate scheme, “hardly”, Also, you have an agreement with the IMF until next year.

The presentation of the 2025 Budget

In another order, he analyzed the presentation of the Budget 2025 which featured a speech by Javier Milei. “This presentation comes after a week in which vetoes, rejections, and non-rejections flew through the air. It was a key week for the pension law. This budget projects resources and authorizes expenses, but The highlight is the guarantee of zero deficit”the analyst added, noting that the document states that if revenue exceeds projections, spending will not increase.

For the economist, the second novelty is that They promise to strictly comply with what they stated in the Budget. This means that “while before it was possible, for example, to increase spending, Now they are going to stand firm on what they have proposed.”.

According to Dal Poggetto, it would be that, “if for some reason the projection of resources fails – either because there are more resources than projected – in that case we are not going to increase expenses. And if, on the other hand, the resources were below the projected level, in that case, we will make sure to reduce spending to ensure a “zero” deficit, touching those items that are not automatically adjusted.

“The clear message is: We are going to maintain the deficit strictly”said the head of EcoGo in an interview with Radio con Vos. Afterwards, according to the specialist, “we will be able to discuss what the macroeconomic scenario is behind this deficit and how the resource and expenditure figures are set up.”

Public spending, from Dal Pogetto’s perspective

This statement, which Dal Poggetto referred to, was one of the basic points that President Javier Milei spoke about in Congress when he presented the 2025 Budget project. His proposal on the coming economy includes a limit on public spending with which the Government gives a clear signal that it will not deviate from its objective of fiscal balance.

And in response to the question about whether what Milei presented in Congress makes sense as an economic plan, the economist clarified that “first of all, this year Milei does not have a Budget, he is working with the 2023 Budget, adjusted. And, secondly: in the literature, Fiscal adjustments are expansionary if and only if they coordinate a collapse of country risk, and the reduction in risk translates into a reduction in the domestic interest rate.” In this regard, he clarified: “The reality is that the Country risk is in the area of ​​1,420 basis points; and the interest rates we are at still leave you out of the financial markets.”