Ventodivino
מגן ולא יראה
Inizio report JPM (sono semestri su semestri che "spinge" sull'Argentina allieva prediletta) di ieri :
Argentina: Is this enough to end the capital flight?
The BCRA hiked the policy rate another 300bp today in a new intermeeting decision
“Difficulties mastered are opportunities won.”
Finale :
Higher inflation, lower consumption (and less optimism on Brazil): Lower growth
Higher real rates are, all else equal, contractionary. Yet, low credit penetration limits the sensitivity of economic
growth to real rates moving higher. Indeed, when analyzing the performance of ARS credit growth, it has
trended higher after suffering a bit of deceleration in December. But the main source of credit growth has been
mortgages (currently 12% of total credit), so far inelastic to rates. Our sense is that consumption-related credit
will decelerate further. For mortgage credit lines, in our view inflation expectations would come to be more
important than real monetary policy rates, as mortgage rates are indexed to inflation (UVA contracts). If the
BCRA manages to stabilize inflation expectations, we can see overall credit growth yet decelerating from the
current 25% real rate. But consumption will suffer not only from tighter credit conditions, but also from lower
disposable income on the back of higher inflation. In all, we subtract 25bp on the back of the revised inflation
and lower credit growth.
We also trim 15bp from the supply side shock stemming from the worst drought of the last 40 years. We thus
acknowledge that our prior revision fell short (note).
Finally, we have revised lower Brazil’s 2018 GDP from 3.0% a month ago to 2.4%y/y (see Brazil: Another
disappointment, another downgrade in 2018 GDP forecast). In our models, this should subtract at least another
10bp from Argentina’s 2018 GDP.
In all, we revised Argentina’s 2018 GDP to 2.4%y/y, from 2.8%.
Argentina: Is this enough to end the capital flight?
The BCRA hiked the policy rate another 300bp today in a new intermeeting decision
- The BCRA hiked the policy rate another 300bp to 33.25% in a new intermeeting decision, on the heels of the 300bp hike last Friday
- The question now is whether this is a real policy rate high enough to stabilize financial conditions. Our initial answer is yes, it is likely high enough…
- …but further hikes cannot be ruled out
- The repeated policy reaction underlines that the BCRA is in full command…
- …but more fiscal effort is deemed necessary
- It’s no time to hesitate on the political front: government should regain control of the legislative agenda
- The consequences of the capital flight: We trim 2018 GDP growth lower to 2.4%y/y, revise eoy2018 USDARS higher to 24.0 and 2018 inflation to 22.2%
“Difficulties mastered are opportunities won.”
Finale :
Higher inflation, lower consumption (and less optimism on Brazil): Lower growth
Higher real rates are, all else equal, contractionary. Yet, low credit penetration limits the sensitivity of economic
growth to real rates moving higher. Indeed, when analyzing the performance of ARS credit growth, it has
trended higher after suffering a bit of deceleration in December. But the main source of credit growth has been
mortgages (currently 12% of total credit), so far inelastic to rates. Our sense is that consumption-related credit
will decelerate further. For mortgage credit lines, in our view inflation expectations would come to be more
important than real monetary policy rates, as mortgage rates are indexed to inflation (UVA contracts). If the
BCRA manages to stabilize inflation expectations, we can see overall credit growth yet decelerating from the
current 25% real rate. But consumption will suffer not only from tighter credit conditions, but also from lower
disposable income on the back of higher inflation. In all, we subtract 25bp on the back of the revised inflation
and lower credit growth.
We also trim 15bp from the supply side shock stemming from the worst drought of the last 40 years. We thus
acknowledge that our prior revision fell short (note).
Finally, we have revised lower Brazil’s 2018 GDP from 3.0% a month ago to 2.4%y/y (see Brazil: Another
disappointment, another downgrade in 2018 GDP forecast). In our models, this should subtract at least another
10bp from Argentina’s 2018 GDP.
In all, we revised Argentina’s 2018 GDP to 2.4%y/y, from 2.8%.
Ultima modifica:
