Informe Mensual Económico Financiero N° 339 – Mayo de 2018
•The IMF projects a growth of 3.9% of the world economy by 2018, which would
be repeated in 2019. All regions of the world are linked to the expansion process
driven by Asia (6.5%).
While the risk of a rate war fades, the Federal Reserve’s decision to accelerate
the interest rate hike that boosted the yield increase of US Treasury bonds and
accentuated an outflow of capital from emerging economies, at the same time
that the dollar reversed its fall. The increase in the international price of oil is
another important note, with a significant transfer of resources from consuming
countries to producing countries.
In Argentina, the balance of the first quarter in terms of economic activity will
show a year-on-year improvement of around 4% (industry grew 3.9% in that
period). Everything converges to a GDP growth in 2018 of between 2.4% and
2.8%, if the volatilization in the exchange rate in April and May become
The fiscal result of the first quarter of 2018 registered a deficit of 91.5 thousand
million pesos, 29.6% higher than in the same period of 2017; total revenues
grew 22.3% and primary expenditure 18.5%. If extraordinary income is excluded
and all debt interests are computed, the deficit for the quarter would rise to 160
thousand million pesos and revenues would grow 18.1% (in line with primary
expenditure). Strong drop in economic subsidies and capital spending (see
The deficit of the Current Account of the Balance of Payments estimated for
2018 (35.0 billion dollars) will deepen in 2019, as the expansive stage of the
cycle continues: with an activity level 15% higher than in 2008, the external
result of 2018 shows a deterioration of 40.0 billion in the decade. This
represents a great vulnerability to the risk of deterioration in international
liquidity, which would force a correction that would negatively impact activity,
investment, employment and inflation (see figure 2).
Accumulated inflation for the first four months will be about 9.3% driven by a
combination of factors: monetary expansion (46% at annual rate in the second
half of 2017) of fiscal origin, currency slippage (23.3% between June 2017 and
April 2018), tariff correction, etc. Before the jump in the relation ars/dollar ending
April a deceleration from May onwards was expected, today in doubt.