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Javier Milei: “I prefer to endure this weak situation of activity a little longer but avoid hyperinflation” - Infobae
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Javier Milei: “Prefiero soportar un poco más esta situación débil de actividad pero evitar la hiperinflación”
El Presidente ratificó el programa económico y dijo que la inflación “ya está por debajo de dos dígitos”, aunque admitió que marzo “es un mes con una estacionalidad profundamente complicada”
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March 13, 2024
The President ratified the economic program and said that inflation “is already below double digits,” although he admitted that March “is a month with deeply complicated seasonality.”
Javier Milei ratificó el rumbo económico y dijo que la inflación seguirá bajando
Javier Milei ratificó el rumbo económico y dijo que la inflación seguirá bajando
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Javier Milei ratified the economic course and said that inflation will continue to fall
One day after knowing the inflation data for February , which confirmed a decrease in the rate of increase in prices, President Javier Milei assured today that he will maintain the economic plan because he prefers to " endure this weak situation of activity (economic) a little longer." ) but avoid hyperinflation.”
In that sense, he stated that “ core inflation is below 10% ,” although he assured that the February number “is a tragedy” and admitted that March “is a month with deeply complicated seasonality.”
“ Opening the trap is much closer than it is far. The Fund's estimates analyze that it would be possible to do so in the middle of the year. What's more, there are economists who believe that we could do it now,” Milei said.
During an interview with journalist Eduardo Feinmann on Radio Miter, the president explained that “ if they had opened the trap on the first day, “the bullfight had a 100% probability,” and that is why he prefers to avoid risk.
“The problem is that if we open, no one can assure me that there won't be a bullfight. That's why I said that to open it now I need to get 15 billion dollars. I am not willing to take the risk, I prefer to endure this weak activity situation a little longer but avoid hyperinflation . We are committed to exterminating inflation and we are doing so. “If you look at the March numbers, despite a rebound, inflation is in the order of 7 or 8%,” he said.
Inflation in February was 13.2% and accumulated 276.2% during the last year, as reported yesterday by the National Institute of Statistics and Censuses (Indec). The monthly data implied a slowdown compared to the 20.6% that January had recorded and the 25.5% in December, which was the highest number since February 1991. The accumulated figure for 2024 stood at 36.6 percent.
Although yesterday Milei said that this data was “a big number”, today he admitted that it is “a tragedy” and “horrible”, although he said that it must be put in context to give it the corresponding dimension. The president insisted that they received the economy with a concrete risk of hyperinflation.
“When the Government took office, the daily inflation rate was 3,700% annually , in the second it accelerated to 7,500. When one takes the wholesale inflation figure of 54% in December, annualized is 17,000%. That is the catastrophe that Kirchnerism left us. When one finishes cleaning the monetary numbers of the last year of Kirchnerism, and I hope it is not only because of the electoral issue of this Government that passed, they issued 13 points of GDP against a monetary base of 2.6% of GDP, "he said .
February inflation in Argentina was 13.2%. Photo: EFE/ Juan Ignacio Roncoroni
In addition, he agreed with the Minister of Economy, Luis “Toto” Caputo, regarding the increase in food, and confirmed that they will open up imports for that sector even more. “The price makers priced under a hypothesis of a dollar of 2,500 pesos. And instead of lowering prices, they started with promotions. That's why prices in Argentina became expensive in dollars. We are going to open more and more so that competition can enter,” he stated.
“The price of food is strongly dominated by what happens with the dollar and now we open imports, and they are going to go down,” he added.
Beyond admitting that the situation “is difficult,” he said that he has a greater positive image than when the Government took office, and that after his opening speech to the regular sessions in Congress, almost half of Argentines believe that the economy will be better. “People are watching it,” she stressed.
“If I compare against the ideal, everything is filthy. Mr. Kicillof always says 'adjustment is avoidable'. Then we would continue with a fiscal deficit financed by monetary emission. And how were we going to finish? We were going to the worst of all worlds, with the worst of the Rodrigazo, Alfonsín's hyperinflation and the crisis of 2001. That was the easy one, but it meant bringing the number of poor to 95%. That’s what we get,” he added.
Adjustment “on caste”, closure of the Central Bank and retirements
During the extensive interview of almost an hour, Milei also insisted that the adjustment that his Government is carrying out falls mainly on what he considers "the caste." “We have halved the number of ministries, secretariats and undersecretaries. We fired 50,000 public employees, cut 10,000 contracts, lowered 200,000 social programs to those assigned, eliminated existing public works, and eliminated discretionary transfers to the provinces. “We made a tremendous adjustment to the policy,” he stated.In addition, he confirmed that the plan is to close the Central Bank, although he clarified that he never said that he would be able to do it quickly.
“We found a Central Bank that was literally bankrupt. We have bought 10 billion dollars, we are rebuilding the balance sheet of the Central Bank. Despite the issuance to buy dollars, despite the remunerated liabilities, the repos, the contraction by Bopreal and by the treasury has meant that the monetary base does not change. We are carrying out a program in which we are going to move to a system of currency competition, then we will send the law to prohibit the issuance of money and then we will advance in the elimination of the Central Bank. All the steps we are taking are so that we can open the stocks, advance to currency competition and close the Central Bank ,” he detailed.
Javier Milei ratified his intention to close the Central Bank. Photo: EFE/Juan Ignacio Roncoroni
Milei was also consulted about the situation of retirees, one of the sectors that have suffered the most from the loss of purchasing power in the first three months of the libertarian government. There, the president said that “it is a historical problem” in Argentina and that it exists “ as a consequence of a pension system designed as a scam, that is the first thing that needs to be told to people.”
Furthermore, he insisted that “the previous Government left with pensions of 80 dollars and today, the minimum plus the bonus is 200 dollars,” and recalled that the new formula was included in the Law, the basis for whose withdrawal he blamed the “politicians who "They defend their interests and not those of the people."
Milei also predicted when he believes the population's income level will begin to recover. “ We believe that when we open the stocks and the rebound in economic activity begins, salaries will begin to grow, beyond the fact that they grew in dollars,” she said.
In addition, he responded to those who complain about the constant increase in the cost of prepaid.
“We believe in price freedom. The point is that until this moment, one of the things that was being done is that you did not pay with the price but with a strong degradation of quality. Now you will be paying for a corresponding service . It is never a good guide to try to touch prices. If the person complaining is bothered by the price, how would he feel if you wanted to touch his pension. It is the right to property,” he highlighted.
