The government is in negotiations with the IMF for changes to the program, as Q1 23 targets were not met. As we have been arguing, the large negative effect of the drought on agricultural production has increased uncertainty about the government’s ability to muddle through
short-term debt will likely have to be monetized. Even though there has been a moderation of monthly prints since the July peak, we expect inflation to accelerate again in Q2 23-Q4 23. This is mainly because short-term peso debt is becoming increasingly hard to rollover, (sigue)
