Money in Argentina
Argentina - Money
Central Bank resumes tightening cycle in November
The Central Bank of the Argentine Republic (BCRA) decided to cut the 35-day Lebac interest rate for the fourth consecutive week on 29 November. The Bank cut the main rate by 50 basis points to 24.75%, bringing the accumulated reduction in the Bank’s 35-day Lebac rate in November to 200 basis points. The removal of capital controls and the end of some subsidies exerted massive upward pressure on prices and the Central Bank had to intervene in order to rein in inflationary pressures.
In its November press releases, the BCRA stated that inflationary pressures had been on the rise in October due to the government’s decision to partially scrap a gas subsidy that month. Higher wages in the construction sector also played a role in the spike in inflation in October. Nevertheless, the BCRA stated that recent estimates from government and private sources suggest that the monthly increment in consumer prices is in line with the 1.50% target for the last quarter of the year (equivalent to an inflation target of 19.6% or less).
Finally, the Bank affirmed that it will continue with its anti-inflationary policy stance in an attempt to bring inflation down to the aforementioned target for the end of this year and to further lower inflation to between 12% and 17% next year. The next monetary policy meeting is scheduled for 6 December.
Participants in the LatinFocus Consensus Forecast see the 35-day Lebac rate ending 2016 at 25.0%. Panelists see the 35-day Lebac rate ending 2017 at 19.6%.
Argentina - Money Data
|Money (annual variation in %)||29.8||38.4||25.7||28.9||28.2|
5 years of economic forecasts for more than 30 economic indicators.
Argentina Money Chart
Source: Argentina Central Bank and FocusEconomics calculations.
|Bond Yield||6.69||0.15 %||Dec 17|
|Exchange Rate||15.43||0.37 %||Feb 16|
|Stock Market||19,563||-0.48 %||Feb 16|
Get a sample report showing all the data and analysis covered in our Regional, Country and Commodities reports.
February 9, 2017
In January, consumer prices in the greater Buenos Aires capital area increased 1.3% from the previous month, accelerating from December’s 1.2% expansion, according to recent data published by the National Statistics Institute (INDEC).
January 31, 2017
In December, industrial production contracted 2.3% over the same month of the previous year, according to the latest data released by the National Statistical Institute (INDEC).
January 26, 2017
In November, the monthly indicator for economic activity (EMAE, Estimador Mensual de Actividad Económica) dropped 1.4% year-on-year, which was an improvement compared to October’s 4.4% decline.
January 24, 2017
In January, the Universidad Torcuato di Tella (UTDT) consumer confidence index held steady at last month’s 44.5, remaining below the 50-point threshold separating pessimistic from optimistic sentiment.
January 24, 2017
In December, exports expanded an astonishing 34.0% from the same month of the previous year, following November’s 20.8% increase (previously reported: +20.5% year-on-year).