Far from trusting in the success of anti-inflationary policies, analysts expect an acceleration in price increases that would end in 2023 with a variation of 110% compared to last year.
This estimate is 10 percentage points higher than the one expressed last month and complicates the Ministry of Economy’s strategy, whose short-term objective is to curb inflationary expectations.
According to the Survey of Market Expectations (REM) prepared by the Central Bank (BCRA), for the group of economic specialists inflation in March was 7%, a rise similar to that published by the Government of the City of Buenos Aires (7 ,1%).
The evaluation that the monetary authority released this Friday integrates the opinions of 60 participants: 26 local and international consultants and research centers and 14 financial entities from Argentina. The data that was collected between March 29 and 31.
For the next 12 months (March 2023-March 2024) analysts calculated a price increase of 113.3%. In turn, they believe that in 2024 it will be 90% and that in 2025 it will be at 54.6%, returning to the level Alberto Fernández received when he became president.
These projections contrast with the latest IMF estimate, which indicated that inflation in Argentina would be around 80% in 2023, although it should be noted that both the multilateral organization and the national government seek not to add gasoline to the fire with numbers that can accelerate it. .
What worries the Palacio de Hacienda is the lack of results in the short-term objective that was intended, at least, to stop the rise to stabilize prices in some range and then encourage a fall.
What analysts see is a very slight slowdown, as they expect 6.3% for April, 6.1% for May, 6% for June and July, 6.1% for August, and 6.2% for September.
These figures jeopardize the price agreements signed by the Minister of Economy, Sergio Massa, with limited increases between 3.2% and 4%.
It should be remembered that there are agreements for food, but also for fuel, construction materials, and private schools, among others, which will be out of balance if these forecasts are met.
Massa had also wanted the parity negotiations to come close to the official projection, but the numbers for the first quarter and what analysts are seeing for the rest of the year complicate the official strategy.
Another worrying figure is the evolution that core inflation promises (eliminating seasonal factors), which is projected at 6.8% for March, 6.3% in April, and 6.1% in May.
One of the consequences of this situation is a possible new rise in interest rates by the Central Bank since the commitment with the IMF is to keep it “positive” (above inflation).
Another worrying forecast was added to this scenario: for consultants, economic activity will fall 2.7% in 2023, when a month ago they expect it to remain unchanged compared to 2022. For the first quarter they expect a drop of 0.9%. , that drop that will deepen to 1.8% in the second quarter, to recover slightly 0.3% in the third quarter.
Factors such as inflation, the drought that causes a drop in income, and the impossibility of the government to obtain genuine financing to finance the fiscal deficit come together for this projection.
This prognosis is devastating for the national government, which will arrive at the presidential elections with a falling economy and a strong loss in the purchasing power of wages.