Inflation in Argentina this calendar year will soar to 55 percent, while the troubled nation's gross domestic product (GDP) will contract by 2.5 percent, according to new survey from the Central Bank.
Those are significant rises. Prices were originally expected to rise by 40 percent this year, with the economy expected to contract by 1.4 percent. Inflation, however, hit 25 percent in just the fisrt six months of the year, data from the INDEC national statistics bureau showed last week.
The new projections, which come from a poll of economists carried out by the national monetary authority, comes just a few days after the Government slapped on currency controls, placed limits on the purchase of dollars and said it would oblige exporters to liquidate their dollars as soon as possible.
Argentina's economy has been in recession since the second quarter of 2018 and the value of the peso against the dollar has fallen by around 20 percent over the last three weeks. In a bid to contain its slide, the Central Bank has sold off reserves of some US$12 billion.
As purchasing power has declined, poverty has risen too, with the most recent data estimating that some 32 percent of Argentines are living below the poverty line.
"For the year 2019, the survey's participants (large private consultancy firms) estimate a general level of inflation at 55.0% (+15 points compared to the previous survey) and a variation of the real Gross Domestic Product (GDP) for 2019 of minus 2.5%, with a 1.1-point drop greater than what they forecast in July, " said the monetary authority in a statement.
The forecast for GDP in 2020 also fell to 1.1 percent contraction, in contrast to the two percent expansion projected in the previous survey, taken in July.
"The projection of the analysts of the average nominal exchange rate for September amounted to 60.00 pesos per dollar (+13.8 pesos per dollar compared to the previous REM)," he said.
The exchange rate closed on Tuesday at 58.49 pesos per greenback, after Central Bank intervention.