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As a torrential downpour rained down on the city of Buenos Aires this Saturday morning Argentina's head of the IMF mission, the Italian Roberto Cardarelli, accompanied by the permanent representative in Argentina, Jamaican Trevor Alleyne, held a meeting with a group of journalists attended by dominio.com
The purpose of the presentation was to express the mission's satisfaction with the progress of the new program implemented by Argentine authorities with the IMF: "We are very satisfied with the latest developments in terms of stability of financial markets" Cardarelli said.
The recession, interest rates, the central bank's margins of action were among the
Even football, Italian and clbadic, Boca and River, was part of the dialogue. Cardarelli wanted to know how to make his team play Lazio Sunday and Alleyne asked what was the best bar to share the Copa Libertadores game.
Next, the salient aspects of the interview
"The results of the new monetary policy framework are good" declared Roberto Cardarelli the Italian economist of the International Monetary Fund in charge of checking the accounts of Argentina. In an endorsement of the program carried out by the government, he stated that "we are very satisfied with the latest developments in terms of the stability of the financial markets". The new monetary policy frameworks "work to stabilize the value of the peso"
Cardarelli predicted that the current quarter would be "the worst". During and before a consultation of ámbito.com acknowledged that there were "many risks", he hoped that the Argentine economy would begin to recover steadily at second quarter of next year.
The head of the IMF mission stated that recently "we found an appreciation (of the peso) that more or less matched the new program." He acknowledged that "it is clearly a more restrictive monetary policy" followed by the Central Bank, but asked about the "starting to lower inflation expectations according to the latest poll of the Central Bank ".
He also pointed out that, from a budgetary point of view, the sanction of the Members' budget had been reached. He added that "we are awaiting the approval of the Senate to then achieve the targets set by the budget."
Before the consultation of the journalists convened in a downtown hotel In the recession, the head of the multilateral organization estimated that "we pay great attention to the activity economic, which is an important area for us and for the Argentinean authorities ".
It appears from his presentation that the national authorities are working with the Fund and have ruled that "I do not see many controversial issues". For Cardarelli, the question is "to continue to implement and expect a stronger reduction in inflation forecasts in the coming weeks".
He also stated that it was incumbent on the Argentine authorities to decide "whether the current monetary policy is the most appropriate to achieve the objectives of the Central Bank, which is fundamentally the priority of the reduction of inflation. "
In this regard, he explained that, in accordance with the letter of agreement with the Fund, " If monetary policy becomes too restrictive, which translates into a very strong appreciation of the exchange rate, the authorities have the opportunity to buy (in dollars) and inject pesos into the economy to ease monetary policy ".
On the contrary, if the exchange rate "depreciates much, this indicates that monetary policy is too lax and that the authorities have the possibility of specified Cardarelli.
thus concluded that "there are margins, two-way safeguard clauses, upper and lower, as if to evaluate an adequate monetary policy regime" but stressed that "such is the decision that must be take the Central Bank. "
• Short Recession
Deep fall of economic activity, Cardarelli replied " that we are worried. Current fiscal and monetary policy has a cost of macroeconomic stabilization.
But he states that "we hope and believe that the recession will not last long, two, three quarters. Already in the second quarter of next year, we will witness a recovery in economic activity, with a recovery of the sector and a reduction in the interest rate, as inflation is declining and a confidence effect. " [19659002] 
The Italian Roberto Cardarelli and the Permanent Representative in the country, the Jamaican Trevor Alleyne.
Increased the more competitive exchange rate and contribution of the sector" This will mean a recovery very significant of net exports. "Although he acknowledged that " the question is how long do we have to wait for domestic demand. "
Beyond the In the coming months, Cardarelli said the Argentine authorities and the Fund "believe that the word will be in the first quarter of next year and that the second quarter will recover"
He considered that "the fourth quarter was going to be the worst" but predicted that the economy would begin to improve next year as "for the first quarter, we expect as inflation begins to fall and The interest rate too. "
To the question of domain.com the amount of inflation that will go down, Cardarelli responded" gradually ".
A responsible IMF also gave details on the use that Argentina will make dollars that the agency will contribute. Cardarelli estimated that "for us, the dollars we will give to the Treasury will serve to pay the needs in foreign currency " because he considered that currently the government had enough resources in pesos to support themselves in national currency.
Instead, he stated that" l & # 39; Next year, they will have a surplus (surplus) of peso needs and that they will then have to convert their dollars into pesos. "And he clarified that " this can be done in two ways (not three), the first is that they sell the dollars to the market, as they did in July, the second is that they sell them to the Central Bank. " [19659002] He adds: " If they sell the dollars to the Central Bank and accept the pesos, they must sterilize them to reduce the amount of money. impact on the monetary base and the preference of the authorities was to avoid the addition of sterilization. They therefore chose to sell directly on the market.
In any event, he specified that the authorities "had the possibility to sell to the market or to the Central Bank" and stated that "we did not discuss because we do not see the need to discuss it. When you see the need to convert dollars into pesos, we will discuss them. "
• Uncertainty
Asked about ámbito.com about its impact on the election year and the fear of investors about a Cardarelli baderted that, in the future return of populism, the forecasts envisaged by the Argentine program "we have a recovery that begins in the second quarter and does not stop and continues in the third and fourth quarters. Of course, there are risks, there are many. "
Of these risks, I detail " that inflation will not fall as soon as we expect, so we need a more restrictive policy, the shock on the markets emerging countries (Indonesia, Turkey), what is happening in the United States in terms of policy normalization … "
And it was also held that " l. Political cycle uncertainty can introduce volatility from the second or third quarter. It's a risk, but the basic scenario we have is that it will not be powerful enough to interrupt the economic recovery process. But we do not have the crystal ball " concluded the manager.
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