This Thursday there was a key meeting at the Central Bank in which the Board defined a new rise in the interest rate. It is that the 7.7% inflation reported by INDEC for March leaves the monetary authority without much room for action, especially considering that it agreed with the Fund to maintain a positive real interest rate.
For 6 months it had been holding it at 75%, but the entity chaired by Miguel Pesce raised it to 78%, the percentage it is at today. Of course, due to the new inflationary step in March, the Central had to make a new decision because, furthermore, the signs for the future do not show a slowdown in the inflation rate.
The most sensitive data is that the core inflation for March, which is detached from seasonal factors, also showed a rise of 7.7%, which indicates that the price rise floor for the coming months is also high.
In this way, for the interest rate to be positive, the increase should be up to the order of 94%, a value that does not seem possible to be reached in this review.
Finally, the rise was 3 points and now it stands at 81%, which in this case leaves the remuneration of fixed terms below the inflation projected for April and May. The decision is extremely delicate because raising the rate makes credit more expensive for the entire economy, further cooling down activity that is in decline.
But not doing so, or doing it in a percentage that is insufficient for the market, can encourage an outflow of deposits since, given the loss of purchasing power, investors may be tempted to seek to dollarize their holdings.
