Wednesday, June 12, 2024

ARGENTINA | 20-02-2023 14:46

Argentina's Economy Minister Sergio Massa says role prevents presidential run

Argentina's Economy Minister Sergio Massa has ruled out a presidential run as long as he remains in his current post.

Argentina's Economy Minister Sergio Massa has ruled out a presidential run as long as he remains in his current post.

Massa's comments came Saturday night in an interview with CNN en Español. The minister is among the leaders of the ruling coalition and has frequently been named as a possible candidate for the October presidential election. When he told coalition leaders at a meeting on Saturday that he would not run as long as he was a minister, the comment was met with scepticism, Clarín reported on Sunday, without saying where he got the information.

Massa also reiterated that he believes the goal of reducing inflation to 60 percent this year is still achievable. He previously said he was aiming for monthly inflation of less than four percent in April, but prices rose six percent in January and the annual figure is close to 100 percent.

Even if inflation exceeds six percent in February and March, he said he would not give up on his target.

Massa said a bad result in one match would not prevent him from competing in the championship to bring down inflation, referring to his country's FIFA World Cup triumph in December.

He added that Argentina was capable of meeting the terms of its agreement with the International Monetary Fund.

Finance Secretary Eduardo Setti said on Twitter on Sunday that fighting inflation is the top priority for him, Massa and the rest of the economic team. But Argentine traders are discounting inflation are sceptical, and a Central Bank survey showed economists expect it to close the year at an annual rate of 98 percent.

The Central Bank on Thursday kept its policy rate unchanged at 75 percent, saying core inflation remained stable. Because of the compounding effect of the interest rate, that still leaves the ex ante real interest rate – or the effective rate discounted by expected inflation – slightly positive, according to Bloomberg economist Adriana Dupita.

To make matters worse, Massa faces a growing local currency debt time bomb. The country cannot borrow abroad and instead has a growing mountain of peso debt. It has refinanced its debt with higher yields and shorter maturities, but that is not a tactic it can sustain forever.

The government is in talks with local banks about a voluntary refinancing to extend maturities to 2025, Infobae reported on Sunday.

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by Sebastian Boyd, Bloomberg

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