Argentina faces market dissatisfaction and widespread actions after financial bulletins

Argentina faces market dissatisfaction and widespread actions after financial bulletins

The new minister faces yet another central challenge: increasing available international reserves, which analysts say are at critical levels.

The ads of tax discipline and austerity made by the Argentine Minister of Economy, Sergio Massaleft market analysts dissatisfied, while social movements expressed concern about the measures, which “leave aside the most neglected”, they noted.

In his first statements as minister, Pasta ratified the fiscal deficit reduction target agreed with the IMF and committed to fight inflation rampant in the country.

THE Argentina committed to reducing the deficit in public finances in a $44 billion agreement with the International Monetary Fund (IMF). The goal is to download it from 3% of the GDP, which reached in 2021, to 2.5% this year; then to 1.9% in 2023 and 0.9% in 2024.

The new minister faces yet another central challenge: increasing available international reserves, which analysts say are at critical levels. For this, Massa announced an agreement with exporters to anticipate sales, seeking the entry of about 5 billion dollars into the Central Bank’s coffers in the next 60 days.

The price of the “blue dollar”, traded on the informal market, reacted with a slight drop, to 291 pesos to the dollar, after reaching a record 350 pesos in July. The Buenos Aires Stock Exchange remained stable and debt securities started the day higher in Wall Streetbut then backtracked.

“Given the level of expectations generated, the market’s feeling is that the measures are insufficient. The common denominator in all investment bank reports is that the battery of announcements fell short when it came to giving consistency to the macroeconomy, especially on the foreign exchange and reserve fronts, where there were practically no definitions,” the economist told AFP. Nery Persichinifrom the consultancy GMA Capital. “The intraday fall in bonds, against emerging debt, would reflect this disenchantment,” he added.

social claims

Although Pasta listed among the priorities of his administration the redistribution of wealth, his announcements were received with concern by social movements and beneficiaries of public subsidies, who demonstrated today in front of the Ministry of Economy.

“There was not the slightest announcement for the most neglected social sectors”, lamented the Frente Pátria Grande, until now an ally of the ruling coalition. front of all (center-left Peronism).

Already Silvia Saravialeader of the popular organization Barrios in Pieconsidered that Pasta showed “a continuity” with its predecessors Martín Guzman and Silvina Batakisand criticized him for having reaffirmed that he will comply with the agreement with the IMF.

Pasta promised better incomes for workers in the private sector and retirees, but, in relation to social organizations, announced only audits in their benefits, aiming at a reorganization.

“He has to help everyone. He has a lot of people who are self-employed or have no work, he has to give to everyone who needs it”, opined jonathanone of the protesters in front of the Ministry of Economy.

THE Argentina register one of the world’s highest inflation ratewith 36.2% in the first half of 2022. Poverty reaches 37% of its 47 million inhabitants.

“Given the high political volatility in the country, the Moody’s expects scant general support for austerity policies ahead of the 2023 presidential election, which will continue to undermine the country’s ability to meet the country’s targets. IMFespecially in tax matters”, concluded Gabriel Torresfrom the rating agency Moody’s.

Source: AFP

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