Weekly

Weekly Reports

2018’s recession will leave a negative carry-over of 3 points for 2019

Second week
of September 2018
This year’s growth perspectives have changed a great deal after the drought and mostly after the currency crisis of the last few months. Currently, we expect a 2.5% fall in GDP for this year. This fall will leave a negative carry over of 3.0 percentage points for 2019. Although we expect the activity to recover star...

Temporary export taxes for primary balance in 2019

First week
of September 2018
The new round of currency run that took the dollar from 28 to 38 pesos in August laid the ground for yesterday’s announcements. The most remarkable one is the re-introduction of export taxes, which will allow to reach fiscal primary equilibrium next year. It was very difficult to think about such a measure a fe...

The fiscal target of next year could be overachieved

Fourth week
of August 2018
The government’s fiscal target set in the program with the IMF requires to decrease the primary deficit from 2.7% of GDP this year, which we consider will be met without difficulties, to 1.3% of GDP in 2019. This represents a fiscal effort of 1.4 points of GDP for next year, greater than the 1.1 effort mad...

Why Argentina is not Turkey, although they might look alike

Third week
of August 2018
Argentina and Turkey are the two economies that most suffered the emergent sell-off. Their currencies and financial assets were the most punished. Both went through exchange crises that increased the dollar’s value 60% year to date, way over other emerging countries. It is not a coincidence, given tha...

Developing the domestic capital market is a must

Third week
of July 2018
A favorable international scenario to provide access to external credit was a key assumption in Argentina’s gradual fiscal consolidation plan. On the other hand, a weak spot in this strategy was an eventual interruption of such financing. Although every emerging country has suffered from capital outflows, Argentina...

Local financial conditions in stress zone due to the currency crisis

Second week
of July 2018
In June the local financial conditions suffered the highest monthly fall since Macri became President and they entered the stress zone for the first time since the exit from the FX controls or "cepo" in late 2015. Why are financial conditions important? The Argentine economy has always grown sustainably when they re...

Using reserves is swimming against the current

First week
of July 2018
Despite a series of positive news, of which we had talked about in last week’s editorial, such as the formal approval of the agreement with the IMF, the inclusion of the Argentine ADR’s in MSCI emerging market index, the successful auctions of Lebacs and Treasury dollar Letes, and the good market reception towards t...