Tuesday, September 20, 2011

IMF says inflation will remain in double digits, still discontent about official data

Growth will be led by many of South America’s commodity exporters—particularly Argentina, Chile, Paraguay, Peru, and Uruguay—all of which are expected to grow at levels near or above 6 percent in 2011, the International Monetary Funda said on Tuesday in its World Economic Outlook.

Regarding inflation in Argentina, it added that "authorities have committed to improve the quality of Argentina’s official GDP and CPI, so as to bring them into compliance with their obligations under the IMF’s Articles of Agreement. Until the quality of data reporting has improved, IMF staff will also use alternative measures of GDP growth and inflation for macroeconomic surveillance, including estimates by: private analysts, which have shown growth that is, on average, significantly lower than official GDP growth from 2008 onward; and provincial statistical offices and private analysts, which have shown inflation considerably higher than the official inflation rate from 2007 onward."

The report stated that in economies such as Argentina and Venezuela, inflation is projected to remain in double digits, reflecting expansionary policies. "Private sector analysts estimate that consumer price inflation in Argentina since 2007 has been considerably higher than official estimates," it stressed.