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We offer reports on the Argentine economic and financial situation, focused on key aspects such as the level of activity, fiscal accounts, inflation, interest rates and exchange rates.
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We make in-company presentations on the Argentine and international economic situation, adjusting to the client's needs.
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We are available for specific queries from our clients on current issues via phone or email.
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We prepare detailed long-term economic forecasts and alternative scenarios for budgeting and decision making.
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Last Reports
The negotiations with the IMF took longer than most people anticipated. Argentina wanted a USD 25 billion program while the IMF probably had in mind half of that amount. There were also discussions about the size of the upfront disbursement, as Argentina was requesting more dollars than the IMF was willing to provide. At the same time, the IMF was asking for more flexibility in the exchange rate regime, an issue that was raised in previous reviews, while Argentina wanted to avoid a step devaluation because it could put pressure on prices. One could summarize the discussions as more money in exchange for more flexibility in the exchange rate regime.
There is no second chance to make a good first impression. After implementing the new floating-withing-bands scheme, the government’s main objective was to avoid an overshooting of the exchange rate and, thereby, fuel the narrative that there was no step devaluation and that prices should not be adjusted.
The monetary policy outlined in the new program shows a shift toward a more conventional framework. Targets are now set for traditional monetary aggregates, such as the traditional monetary base or M2, instead of capping the broad monetary base — another Argentine invention that does not appear in any textbook. The rigid 1% monthly crawling peg, which was meant to perpetuate a concerning currency appreciation, was also abandoned. In its place, exchange rate bands were adopted, allowing FX to float between a floor of 1,000 and a ceiling of 1,400 pesos. But, as is typical in Argentina, the new regime brought several surprises, and in many cases, the main party caught off guard was the IMF.
Objetivo de pass-through cero. Tras el anuncio del nuevo esquema de bandas, el objetivo principal del Gobierno fue evitar un overshooting y minimizar el traslado a precios. Para presionar el tipo de cambio a la baja anunciaron la vuelta del carry trade para extranjeros (con 6 meses de permanencia, aunque pueden salir por CCL), dijeron que solo iban a comprar reservas en el piso de la banda, y presionaron al campo para que liquidara antes de que suban de nuevo las retenciones. También salieron con los tapones de punta contra empresas que mandaron listas con aumentos, arengando a no convalidar subas. Por ahora, el objetivo se viene cumpliendo: tras el salto inicial, el tipo de cambio retrocedió y muchas empresas dieron marcha atrás con los aumentos. En este contexto, esperamos que la inflación de abril se ubique más cerca del 3.7% registrado en marzo que del 5%, aunque hay arrastre de los últimos días de ese mes.
The first few days without capital controls were, without a doubt, a success for the government. The market reacted very positively to the announcements: far from testing the upper bound, the exchange rate settled closer to the lower band. The Merval index started off strong, later gave up some ground, but bonds remained firm and country risk dropped toward 700 basis points. The exchange rate spread collapsed.
Articles
Más rápido de lo que muchos economistas esperaban, el Gobierno va consolidando su objetivo de cerrar el año con déficit fiscal cero, mejora de las cuentas del Banco Central, y camino a la tasa de inflación de un dígito porcentual….
About Us
Graduate in Economics from the University of Buenos Aires and Ph.D. in Economics from Columbia University. Professor and researcher at the Di Tella University and academic advisor at FIEL
With vast experience as an advisor to multilateral organizations such as the IMF, the World Bank and the Inter-American Development Bank, as well as several Latin American countries, he held prominent roles in the financial sector, including the presidency of Banco Hipotecario S.A. and functions in the Ministry of Economy and the Central Bank of the Argentine Republic.
He was an Assistant Professor at the University of Maryland, and taught at institutions such as CEMA, Georgetown University, and Columbia University.
He is a columnist and author of numerous articles in international publications. Author of the book “The Argentine economic crisis, a history of adjustments and imbalances” with Sebastián Kiguel.
Graduate in Economics from the University of Buenos Aires and MSc in Economics from the University of Warwick (UK).
He was an economic consultant at the Inter-American Development Bank (IDB) and at Econviews. He also served as an advisor at the Ministry of Economy and the Ministry of Transport of Argentina.
Alejandro Giacoia
Economist
Bachelor of Economics (UBA).
Pursuing a Master’s Degree in Finance (Di Tella)
Pamela Morales
Economist
Bachelor of Economics (UCEMA).
Associate Professor of Macroeconomics UCEMA
Rafael Aguilar
Economist
Bachelor of Economics (UBA).
He was an assistant in the UBA National Accounts chair
Leila García
Economist
Bachelor of Economics (UBA).
Assistant in the UBA Argentine Economic History