Argentina is in a period of great volatility in terms of inflation. However, the J.P. Morgan bank predicts a trend towards stability between the end of 2024 and the beginning of 2025.

The challenges that Javier Milei faces are not simple. According to J.P. Morgan, the Consumer Price Index for September was 3.5 %, thanks to a drop in food prices, “the reduction of the PAIS tax and a slowdown in regulated prices.”

Core inflation stood at 3.3 % monthly, the lowest level since January 2022. A slightly positive indicator “in a context in which annualized inflation continues to exceed 200 %.”

J.P. Morgan projects a slowdown in inflation following the pattern of the first week of October, when it stood at 3.1 % monthly, as a result of a decrease in the value of food (0.6 % weekly), “as well as the announced decrease in gas and fuel prices (-4.5 % and -1% monthly, respectively), which contributes to moderating increases in the general CPI index.”

According to the bank’s estimates, average monthly inflation could be 3.7 % in the fourth quarter of this year, with a slight rebound at the end of the period (125 % year-on-year) and at the beginning of 2025 “due to the transition to a new policy framework and the unification of the foreign exchange market, in line with other local consulting firms.”

Once 2025 begins, J.P. Morgan would be working to achieve an average deceleration of 2% per month, in order to achieve stabilization.

M.Pino

Source: ambito

(Reference image source: Jakub Żerdzicki in Unsplash)

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