A hyperactive Economy Minister Sergio Massa responded early in May to the announcement of 8.4 percent April inflation just before last weekend, raising interest rates from 91 to 97 percent to lure pesos away from the dollar (but with a nine percent reduction for the Ahora 12 consumer purchase plan), stepping up intervention on money markets (including the legal but parallel financial exchange rates), instructing the Central Market to import food to hold down prices, easing the import of capital goods and intensifying negotiations with the International Monetary Fund and China to accelerate the inflow of hard currency. Virtual negotiations with the IMF to boost Central Bank reserves continued “constructively” all week, headed by Deputy Economy Minister Gabriel Rubinstein. Massa not only wants all the US$11 billion of IMF remittances due this year already next month, pleading drought difficulties as a “game-changer,” but also authorisation to use up to 60 percent for money market intervention while the IMF is not prepared to go beyond 20 percent.
SOURCE: batimes.com.ar