IMF forecasts for the Argentine economy | Chronic

The International Monetary Fund (IMF) warned Tuesday in its report on the outlook for the global economy (WEO) on the slowdown in the global economy in 2019, which will grow by only 3.3% , while for Argentina the prospect of an economic contraction, to 1.2% of GDP (gross domestic product), while I expected six months ago to a decline of 1 , 6%.

In his WEO report that he presented during this day in Washington, the IMF also predicted an exit from the Argentine recession for 2020, while the economy would grow by 2.2%.

"It is expected that Argentina's economy will shrink in the first half of 2019 with slowing domestic demand, due to tighter policies aimed at reducing imbalances, and that it will pick up again in the first half of 2019. second half recover real disposable income and agricultural production after drought last year ", the body has been expanded.

At the same time, for Latin America, it has estimated an increase of 1.4% for this year and an improvement of 2.4% in 2020.

According to the financial organization, after reaching a growth peak of 4% in 2017, the global economy slowed down for the second year in a row, registering a growth of 3.6% in 2018 and an increase of 3.3% expected. the current period. In this way, the projections of the last report have been corrected downward.

"A year later, many things have changed: trade tensions between China and the United States, macroeconomic tensions in Argentina and Turkey, the interruption of the auto sector in Germany, the tightening of credit policy in China and the tightening of monetary policy in China, the largest advanced economies have contributed significantly to slowing the pace of global expansion "said at a press conference the chief economist and director of the research department, Gita Gopinath.

Therefore, he stressed that "The WEO predicts a 70% drop in the global economy" for this year and warns against the impact of rising interest rates in the United States and in the US. other advanced economies, which "converge towards their long-term potential"..

As for the rest of the macroeconomic indicators, the Fund expects an inflation of 30.5%, which is why it considered it essential to reach the zero deficit this year. "strengthen investor confidence and sustainable growth".

For the IMF, "The rise in nominal wages and the rise in inflation expectations will generate more persistent inflationary pressures in 2019, compared to those projected in the WEO of October 2018".

At the same time, unemployment would increase to 9.9% this year, against 9.2% estimated in 2018, according to the report.

He also warned that "the risks for the economy are still considerable".

In this context, the body recommended "The continued implementation of the stabilization plan as part of the IMF-supported economic reform agenda is crucial to boost investor confidence and restore sustainable growth that raises the standard of living for all segments of society." ".

To this end, "to respect the primary fiscal balance target of zero in 2019 and 1% of GDP in 2020 is essential to reduce the need for financing and avoid reigniting pressure on liquidity", he said.

Finally, the mid-term economic estimates for 2020 for Latin America were more favorable, partly because of the expected recovery, as the report indicated that for the next period, "2.4% growth is forecast for Latin America", while "for the medium term, it should reach 2.8%".

"Financial stabilization and recovery in Argentina, where growth is expected to strengthen by around 3.5% in the medium term (2024), help to boost growth in this region"he concluded.