The Minister of Economy, Luis Caputo, spoke about key issues for the economy and the plan Xavier Milei, among them reserves, the exit of the exchange rate, the exchange rate, inflation, tariffs and negotiations with the IMF. Among these issues, he confirmed that the Government is negotiating with a group of banks a REPO that strengthens the coffers of the Central Bank.
Caputo made a staunch defense of Javier Milei’s economic plan, which this week marks 10 months in office. The official maintained that inflation continues to decline, and that salaries and pensions rise over the year above prices. He acknowledged that the economy will fall 3% this year, but that there are clear signs of rebound.
“Since we took office, accumulated inflation was 144%; and retirements, without bonus, rose 158%. This is what the official indices say. The same people who last year, in the midst of the ‘Platita Plan’, in the midst of waste, took 30% from retirees, now demand that you give them more, when we, in the midst of adjustment, have made it possible for them to beat inflation “said the minister.
And he added: “Inflation reached single digits in April; In August wholesale inflation was 2.1%; and the dollar is lower than when we arrived. The important thing is that clearly the inflationary trend is downward, and it is natural that it should be so.”. The Government is betting that the private sector, also taking into account the impact of money laundering, will be the engine of recovery.
He also said that “to the extent that there is less inflation, there is more stability. That generates better economic expectations. With a stable macroeconomic framework, investments begin to come. In fact, we are already seeing it.”
Regarding the dollar clampdown, he said that the exit will come when “it does not generate stress either in the people or in the economy.” “We don’t set dates, we set conditions,” he said. He reiterated that the country can grow despite the restrictions.
He also highlighted that the exchange rate is lower than when the Government took office. “When the dollar was at $1,500, in June, all the doomsayers came out to say that we lost the possibility of getting out of the stocks, that the dollar was going to two thousand… What did I say? That the dollar was going to converge to the official exchange rate. It is not optimism, it is that we know what we are doing. That is what is going to happen. In the first interview I told you: what I am going to say sounds crazy, but we are going to a scheme where in a few months. The pesos are going to be missing. And I always said that in currency competition, the peso was going to be the strong currency. Today, ten months later, pesos are starting to become scarce and it is clear that the peso is going to be the strong currency. I mean, nothing happened by chance,” he said.
Regarding rates, Caputo assured that the update rate will be reduced from now on. He explained: “What happened at the beginning is that we came from such a low base that the increase in percentage terms became higher. But in the first interview we talked about the false subsidies… they make you believe that they don’t charge you for electricity, but in reality they are charging you much more, with an inflation of 250% in everything else that you have to end up paying. And again, the one who suffers the most from inflation is the one who has the least. So, I make you believe this scheme. That I am good and I give you money and I give you a subsidy is false. And not only is it paid, but it is paid by the one who can least defend himself, who is the one who has the least. Because he who has money has a way to cover himself. That’s the least of it. Naturally that happened and now it’s going to be much more subdued, of course.”
“As time goes by, we are leaving behind the bad effects of the previous government’s terrible monetary policy, and the effects of the much more orthodox monetary policy that we implemented are beginning to prevail more and more,” Caputo said.
On other issues, he confirmed that the Government will go to court against the university financing law if it fails to ratify the presidential veto in Congress, defended the privatization of Aerolíneas Argentinas, and assured that he will not go to Parliament to defend the 2025 Budget.
Within the framework of the financial front for the Government, the minister referred to the negotiations with the organization led by Kristalina Georgieva: “The IMF program ends at the end of the year. Now we have the ninth and tenth revision. Depending on how the variables of the economy evolve, we will request a new program or not. If we ask for a new program it is with the objective that there are new disbursements. “We haven’t decided yet.”
On the other hand, he stated that there is no risk of seizure of the gold that the BCRA sent to London. “There has been gold from the Central Bank outside the country since 2011. The gold and dollars are from the Central Bank, not from the Treasury. There is no risk of embargo,” he said in the interview with LN+.
In addition, he highlighted the results of money laundering, which he claimed had already reached US$13,000 million in cash, and insisted that the purpose is not to raise money, but to reactivate the economy. “The purpose of laundering is for people to take the dollars out of the mattress, take them out of the safe deposit box, and get a return from them. This favors the economy because it favors the development of the capital market. What we are looking for with money laundering is to reactivate the economy. Bleaching is very good,” he concluded.
Source: Ambito
I am Pierce Boyd, a driven and ambitious professional working in the news industry. I have been writing for 24 Hours Worlds for over five years, specializing in sports section coverage. During my tenure at the publication, I have built an impressive portfolio of articles that has earned me a reputation as an experienced journalist and content creator.
