The general elections in Argentina that are scheduled to be held later this year may lessen the desire for reforms in the country, the International Monetary Fund's (IMF) Regional Economic Outlook Update for Latin America and the Caribbean said on Friday
WASHINGTON (Pakistan Point News / Sputnik - 25th January, 2019) The general elections in Argentina that are scheduled to be held later this year may lessen the desire for reforms in the country, the International Monetary Fund's (IMF) Regional Economic Outlook Update for Latin America and the Caribbean said on Friday."In Argentina, the upcoming general elections in 2019 could reduce reform appetite," the IMF said.
The IMF noted that Argentina's economy went into recession last year, saying that while a severe drought reduced agricultural output and exports, the strong peso depreciation around mid-2018 fueled inflation and reduced disposable income and investor confidence.
"The government's stabilization plan, based on revised and strengthened monetary and fiscal policies, helped reduce the financial turmoil and stabilized the exchange rate," the IMF said.
Inflation and inflation expectations have been on a downward trend since October, and look set to continue a slow decline in 2019, the IMF pointed out.
"This should allow a gradual fall in interest rates, which together with higher real wages and stronger exports is expected to trigger a recovery of economic activity starting from the second quarter of 2019," the IMF said.
In December, the IMF Executive board decided to approve a $7.6 billion disbursement to Argentina and a request for a change to the country's performance criterion.
In October, the IMF increased Argentina's stand-by financing deal to $56.3 billion after the country agreed to stricter fiscal measures, including deep spending cuts and higher taxes.
Argentina and the IMF reached an initial $50 billion stand-by arrangement in June.
