Macroeconomic Forecast Argentina

BMI View: Argentina's money supply continues to grow at a precariously fast rate, with each of the monetary aggregate measures, M1, M2 and M3 rising more than 20% year-on-year in June. With further inflationary pressure coming from ongoing currency intervention and the government's lax fiscal policies, we see little prospect of an end to the country's runaway inflation anytime soon, and hold to our forecast for consumer price inflation to reach 21.0% y-o-y by year-end and 18.0% y-o-y by end-2011.

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