Macroeconomic Forecast Argentina

September 2007 | Macroeconomic Forecasts

INDEC , food and education prices rose the most of any category on the month, a theme which has recurred throughout the year. The data no longer packs much of a punch, however, given a widespread loss of faith in official statistics reporting. Private estimates of actual inflation have for many months run anywhere from 12% to 16%, and it is likely that business negotiations (including those involving wages) compensate for this discrepancy. While the government defends the validity of the data, reports from a local statistics office in the Mendoza region, which did not adopt the methodological changes implemented by INDEC, put inflation at around 18% y-o-y. Our forecasts continue to track the headline figure, and as such, we retain our year-end target of 8.9%. We have, however, raised our forecast for end-2008 to 9.1%, from a previous 8.9%.

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