LatinNews Daily - 26 November 2020

* Argentina’s Economy Minister Martín Guzmán said a key government objective was to gradually reduce inflation (which stood at 37.2% in October in annual terms) to “single-digit figures” to arrive at a situation of “equilibrium”. Speaking at an event organised by Argentina’s central bank (BCRA), Guzmán said this is not possible to achieve from “one year to the next” but takes time. He also ruled out the possibility of stabilising the economy through a “confidence shock”, criticising the poor results obtained with the Stand-By Arrangement (SBA) that the previous administration led by Mauricio Macri (2015-2019) reached with the International Monetary Fund. Guzmán said there is no “silver bullet” to change inflation expectations from one moment to the next and that one of the central premises of the SBA – zero monetary base growth – failed to result in a change of behaviour given that economic actors also take into consideration “signs such as prices and tariffs”. He added that to stabilise the economy, it is necessary to “plant the seeds for the future” which “takes time”.

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