The former Minister of Economy, Domingo Horseaffirmed this Thursday night that the inflation figure for June, of 6%, “it is very high, but it is not something that can be attributed to a measure of the last few months. It has to do with the whole story of 2022 and 2023.” He also supported the payment to the IMF in yuan and opined that Sergio Massa does not share the economic vision of Kirchnerism.
“I think it’s okay for Massa to use the yuan so as not to drop the relationship with the International Monetary Fund. It would be worse if they simply had not complied, because they would have fallen into default,” Cavallo analyzed, adding that the minister’s strategy is to “play” with the concern of the United States regarding Argentina’s relationship with China. “But I would say it is validgiven the situation we are in,” he said.
In interview with Luis Majul in LN+Domingo Cavallo opined that do not devalue “is correct, because here what you have to think about is how the exchange market is unified”. He also indicated that a “loose devaluation, like the one in 2002, is totally disorganizing of the economy” and recommended to the current minister “to say that he is really making a fiscal adjustment”.
Cavallo supported Massa and opined that not devaluing “is correct”
“Saying it is remarkable, because it is being done. Look how much pensions have fallen in real terms. What he should say is ‘the fiscal adjustment that we are going to make it will no longer be at the cost of an inflationary acceleration that hits wages, but a real restructuring of the public sectora reduction of oversized activities’”, Cavallo proposed.
Regarding Sergio Massa’s candidacy for president for the Union for the Fatherland, which he defined as a “tremendous limitation,” Carlos Menem’s minister decided to recall the case of Brazilian politician Fernando Henrique Cardoso: “He personally was not an economist and when decided to launch the Real Plan, resigned from finance ministry to campaign. Of course, the success that he began to have with his plan earned him to be elected, ”he suggested.
Massa does not know if he will continue to be Minister of Economy during the electoral campaign
In addition, alleged that Massa “does not think” like Kirchnerism “in economic mattersbut the speech he is making is conditioned by that misinterpretation of Argentine history and economic reality.”
Cavallo believes that Massa “is very involved” with the ideas “that Kicillof put into Cristina Kirchner’s head and that they are in my book road to stability, which are Zaiat’s ideas and they are totally wrong”. Finally, he postulated that these ideas “have framed the government of Alberto Fernández, who what he did was say ‘yes, Cristina’ and adopted that thought, which is ruinous for the country.”
According to INDEC, inflation in June was 6%
June inflation stood at 6%, according to what was reported by INDEC this Thursday, marking the second consecutive decline from the peak of 8.4% registered in April. In May, it reached 7.8%.
This data It is the first since the announcement of the candidacy of the Minister of Economy and the last to meet before the Primary Open, Simultaneous and Mandatory (PASO) that will take place on Sunday, August 13, since the inflation for July will be announced on Tuesday the 15th. Inflation accumulated a variation of 50.7% in the first semester of 2023, while in the year-on-year comparison, the increase reached 115.6%.
Domingo Cavallo warned that inflation could jump to 9% per month after the PASO
According to INDEC, the division with the highest increase in June was communications (10.5%), product of the rise in telephone and internet services. They followed Health (8.6%) —due to increases in medicines and in the fees of prepaid medicine companies— and living placewater, electricity, gas and other fuels (8.1%), mainly due to increases in electricity.
In all regions, the division with the highest incidence was Food and non-alcoholic beverages (4.1%). Within this division, the rise in Bread and cereals and Milk, dairy products and eggs impacted.
For their part, the two divisions that registered the smallest variations in June were Food and non-alcoholic beverages (4.1%) and Clothing and footwear (4.2%).
ML / ED