The legacy of 2021 and what comes for 2022
There were few achievements last year, but many of the problems that troubled the economy at the beginning of 2021 are still alive and kicking. The exchange rate, and the risk of a steep devaluation, was one of the main concerns since the beginning and has remained a main issue throughout the year. The government […]
The IMF and the exchange rate dilemma
The opposition was the clear winner in the mid-term elections. It defeated the government coalition by eight percentage points at the national level, it won key provinces such as the province and the city of Buenos Aires, Cordoba, Mendoza, Santa Fe and Entre Rios among others, including the emblematic province of Santa Cruz (see map: […]
Difficult political and economic scenarios condition the IMF agreement
The defeat in the primaries marked a before and after for the government coalition. There were important changes in the cabinet and the tensions within the government became apparent. There are different visions about what to do in the economic front. On one side we have the more radical wing (led by Cristina Kirchner and […]
The elections, the economy, and the inevitability of the adjustment
The results of the primary elections (PASO) were surprising. Mainly because the government lost by ten percentage points at the national level and in the crucial province of Buenos Aires by almost five percentage points. If the results end up being similar in the actual mid-term elections on November 14th, it could lose some seats […]
Is there a way to turnaround the economy?
Inflation, the exchange rate, and economic activity are moving in election mode. The government is using all its firepower to keep the main economic variables under control. Inflation, which had reached 4.8% in March is now hovering at around 3%, the official exchange rate continues to crawl at only 1.2% per month, much lower than […]
The economy and the elections: playing poker with no aces?
The electoral calendar is moving ahead, and soon we will know the candidates for the primaries that will take place on September 12th. These elections are important. They should decide whether the government can get closer to having a majority in the Lower House, a situation that would allow to pass laws in Congress and […]
A Soft Transition to the Elections: The Calm That Precedes the Storm?
It seems that the government has enough instruments to maintain key economic variables under control until the elections. The official exchange rate should be manageable and avoid a steep devaluation, the government should be able to rollover the domestic debt, inflation could remain within predictable bounds and economic activity is likely to recover in the […]
In Search of a Program: Hope in Paris, Not So Much in Buenos Aires
Who is in command? This is a critical question when it comes to economic policies. Minister Guzman is formally the Minister of Economy, but he seems to be primarily in charge of managing debt and the relationship with multilateral organizations. This is a good start, because a potential IMF agreement will set monetary and fiscal […]
Inflation rose in March, but the economy will still muddle through until the elections
It is increasingly clear that the government is taking every economic decision with an eye on the election and that the 4.8% March inflation rate was a disruptive figure and a potential threat. It was totally unexpected, much higher than anyone was projecting. This jeopardized the strategy of avoiding disruptions on the way to the […]
The efforts to avoid adjustment might work until the elections, and then what?
The current economic situation raises two important questions. Firstly, can the government continue to muddle through until the October elections as it did in recent months? In other words, can it keep inflation under control, avoid a new acceleration of the parallel exchange rates and maintain the current growth momentum going? Secondly, and if the […]