The market recalculates 2025 inflation, after the slowdown of the “crawling peg” and without the COUNTRY tax

The market recalculates 2025 inflation, after the slowdown of the “crawling peg” and without the COUNTRY tax

The inflation In Argentina it continues to be the focus of analysis for the Government and economists. According to the latest reports, including the survey of FocusEconomicsdisinflation expectations are observed for 2025 driven by key measures, such as the decrease in the “crawling peg” and the elimination of the PAIS tax.

Optimistic projections for 2025

The price index closed 2024 with a 117.8% year-on-yearwell below the peak of 166% recorded in November. This marked the lowest rate since July 2023. According to specialists, The inflationary pace could be significantly reduced in the coming months.

The general consensus, according to the average between economists and banks, indicates 31.7% annually, even higher than the 18.3% estimated by the Government.

By 2026, inflation is expected to decline further, hovering around 20.3%according to FocusEconomics.

The impact of the “crawling peg” and the elimination of the PAIS tax

The reduction of the crawling peg has moderated the depreciation of the Argentine peso, which limits its inflationary impact. Additionally, the recent elimination of the PAIS tax on imports has helped alleviate pressures on prices of imported goods, further stabilizing costs in key sectors.

Food, a persistent challenge

Food and beverage prices, however, continue to be a source of inflationary pressure. According to LCGin the third week of January, food registered an increase in 0.9%accumulating a 2.6% in the month. This increase keeps the alarm bells ringing, although general projections for January suggest that the index will not deviate significantly from the Government’s goals.

Towards a stabilization outlook

Despite the positive projections, the challenges of achieving sustained inflation below the 2% monthly they remain. Experts agree that fiscal and monetary measures must be constant to consolidate the trend, especially in the face of factors such as the sensitivity of food prices and the dynamics of the exchange market.

The figures indicate progress on the path towards economic stability, although compliance with official goals will depend on the Government’s ability to maintain these policies and foster market confidence.

Source: Ambito

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