This Saturday, April 1, the text in which the International Monetary Fund (IMF) explains the criteria by which it approved the fourth revision and enabled the rotation of $5.4 billion. In the document it was detailed that the organism returns to the charge with accelerating the pruning of subsidiesraise the dollar price and relieve the impact of the moratoriumalthough the Government will not back down on this last point.
“The fiscal cost of the new pension moratorium must be mitigated through strict regulations to target the entry only to those most in need”, pointed out the Fund on this issue, which it refers to with the term “policy set backs”.
The Pension Moratorium was regulated: 10 points to pay close attention to
However, the executive will not revise the law of Congress that will allow them to retire more than 800,000 people who are old enough but do not meet the years of contributions established to obtain the benefit. The initiative has already been enacted.
On the other hand, the Fund asked Argentina to speed up the removal of subsidies to energy rates for sectors with greater purchasing power.
The text bearing the signature of Gita Gopinaththe IMF’s first deputy managing director, acknowledges that heThe drought produced a mismatch of the plans provided for in the original agreement for 2023, therefore recognizing the need to reduce the reserve accumulation targets, which this year were US$12.4 billion, and which would be reduced by US$2 billion.
Meanwhile, he warns regarding the need to redouble the adjustment to ensure that the fiscal deficit remains at 1.9% of GDP, something that in nominal terms will surely rise due to the effect of inflation. In other words, the final number might be higher than expected, but always representing 1.9% of GDP.
The increase in the price of the dollar
In this regard, the organization does not mention a desirable dollar level but it does speak of remove restrictions on the foreign exchange marketwhich ultimately means a higher exchange rate and fewer obstacles to trade or interventions by the Central Bank (BCRA).
“Real interest rates should remain positive enough to face high inflation and support the demand for assets in pesos”, considered the Fund, at the same time that it stated that “additional rate increases may be warranted in the event of new inflationary shocks or intensifying exchange rate pressures”.
“Crawl rate should continue supporting competitivenesswith recent actions to rationalize the exchange rate regime and expedite exports” and it is “necessary” to mobilize the support of multilateral and bilateral partners, Gopinath concluded.
FP CP
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