The economy will close this year with inflation in a range that goes from 72.6% to 75.1% according to the general average or that of the 10 forecasters who have been most assertive in this type of projections, which would mean the highest level since the end of the last hyper, in the first part of 1991according to the Survey of Market Expectations (REM) carried out month by month by the Central Bank (BCRA).
In turn, they predicted that core inflation (that which excludes the most volatile prices) would reach 72.8%, being 8.6 points higher than what was projected in the last survey.
The latest projection, which emerged from the survey carried out in the last days of May among 41 analysts of different tendencies and backgrounds, is 7.5 to 9.4 points higher than what they had done just a month ago. And thus marks the eighth consecutive month in which the inflationary expectations of the market are corrected upwards once more. The problem is that they do it more and more violently, which reveals a complex inertia with which the economy coexists.
The upward recalculation is once once more affected by the estimate of a CPI for April (of 5.6%) that was lower than the 6% that was finally registered. But predicts a monthly inflation of 5.2% for May (data to be officially known in 10 days), which is in line with the range of 4.7%-5.4% in which the private measurements released so far for that month were located.
The high inflationary inertia, and the impact that can already be seen in consumption, led the economists consulted arcut its projection of economic growth for this year from 3.5% to 3.3%, which is the first downward revision in five months.
According to their estimates, the economy has already begun to go through a stage of contraction that will cause it to fall 0.9% this quarter (0.1% more than projected until a month ago). This trend would continue, according to the participants of the REM, since they project a decrease of 0.4% for the third quarter, which confirms that the final growth rate would be a consequence of the expansive inertia with which the activity ended 2021.
Market forecasts indicate that inflation would be consolidating a slight downward path from the “peak” of 6.7% reached in March. This is because the 5.2% projected for May would be followed by another 5% in June, which would drop to 4.5% in July, before bottoming out at 4% per month between August and October.
The higher inflation floor that would leave 2022 forced analysts to revise upwards its forecasts for 2023, placing it at 60% per year (+9.5 points than the April REM) and by 2024 at 47.8% per year (4.1 points higher than the previous survey).
They also revised their monthly projections for the nominal exchange rate upwards. Now they expect the wholesale dollar to reach $157.97 per dollar in December 2022compared to the $155 estimated in the previous survey, taking into account that the commitment assumed by the Government with the IMF is not to delay it so much with respect to local inflation.
This is an increase of 53.9% for all of 2022, some 19 percentage points less than the estimated inflation for the same period.
