Market Expectations Survey (REM), September 2023

This report, published on October 12, 2023, discloses the results of the survey conducted from September 27 to September 29, 2023. It includes estimates from 36 participants, 24 of which are local and international consulting firms and research centers, and the other 12 are financial institutions from Argentina.

The median forecasts pointed to a monthly inflation of 11.7% in September 2023, while the actual inflation turned out to be 12.7% (1.1 p.p. higher than that predicted by the REM). In the ninth survey of the year, analysts estimated a monthly inflation of 9.5% for October 2023 and an annual rate of 180.7% y.o.y. (up 11.4 p.p. against the previous survey). Top-10 analysts (who most accurately forecast this variable in the past) expected an inflation rate of 9.4% for October, and of 183.8% y.o.y. for 2023. Regarding the core CPI, REM participants forecast 187.5% y.o.y. for 2023.

September's survey estimated a decrease of 2.8% in the real GDP for 2023 compared to the average for 2022. However, this means an improvement of 0.14 p.p. against the previous survey. This improvement is mainly observed in the third quarter, a period for which analysts reduced their estimated contraction of the seasonally-adjusted quarterly GDP by 1 p.p. However, the analysts who most accurately forecast this variable in the past expected a drop of 2.7%, on average, in the GDP for 2023. For 2024, REM participants estimated another average fall of 1.2% y.o.y., down 0.6 p.p. against the previous survey.

Moreover, the survey revealed that unemployment would have a share of 6.9% in the economically active population (-0.5 p.p. against the previous survey) in the third quarter of 2023, while top-10 analysts, on average, forecasted a 6.7% unemployment rate in the same period.

REM analysts forecast that the BADLAR rate at private banks would be 114.1% APR (9.4% effective monthly rate) in October. They expected that the interest rate would increase to 125.5% in December 2023, which equals a 10.3% monthly interest rate. The most accurate forecasters in the short term estimated that this variable would, on average, rise to 117.1% in October 2023.

The nominal exchange rate was expected to be ARS350/USD on average in October 2023 (an estimated monthly variation of 0.0% as observed since August 15, 2023). The most accurate forecasters projected an average nominal exchange rate of ARS365.6/USD for October 2023.

The change rates are expected to be positive between November 2023 and February 2024, while the wholesale dollar price was forecast to reach ARS776.3/USD by March 2024.

As regards FOB exports, REM analysts predicted that they would reach USD68,363 million in 2023, exceeding the forecast of the top-10 analysts, who projected an amount of USD67,515 million. As for CIF imports for 2023, REM analysts as a whole forecast that they would stand at USD73,204 million, while top-10 participants estimated that they would reach USD73,132 million. Thus, a FOB/CIF trade balance deficit of USD4,841 million is expected for 2023.

Finally, REM analysts projected that the primary fiscal deficit of the non-financial national public sector would stand at ARS5,005 billion for 2023, and at ARS3,749 billion for 2024 (ARS517 billion and ARS1,249 billion higher than the previous survey, respectively). The average projections made by the top-10 forecasters of this variable revealed a deficit of ARS4,733 billion for 2023.

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October 12, 2023