The political forces preparing to campaign

At the beginning of April, FX instability returned and the Peso weakened to almost 44.00. The Central Bank used dollar futures and increased the interest rate to 68.4% in order to contain the depreciation. FX proceeds from the harvest and Treasury's FX daily auctions for USD 60 million helped to stabilize the currency. As an additional measure, the CB announced yesterday that the FX bands, that delimit the Non-Intervention Zone (NIZ), will be frozen at the current levels of 39.76 - 51.45 until the end of 2019. Previously, they were meant to crawl 1.75% per month. The main relevant change is that the CB will not purchase reserves when the FX is below the NIZ. The entity is still allowed to sell USD 150 million per day if the Peso surpasses the upper limit of 51.45. The initial reaction of the currency was appreciating 1% to 41.80.

On another hand, and in spite of the zero-growth of the monetary base, national inflation accelerated in March and was 4.7% m/m (3.8% in February). This way, the official indicator stood 54.7% above a year ago and accumulated inflation rose to 11.8% in the first quarter of the year. Core inflation was 4.6% m/m while regulated prices increased 4.9%. Inflation was influenced mainly by increases in food prices (6.0%) and education (17.9%).