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IMF sees inflation expectations anchored in Mexico, not in Argentina

IMF sees inflation expectations anchored in Mexico, not in Argentina
© Reuters. FILE PHOTO: The International Monetary Fund (IMF) logo is seen outside the headquarters building in Washington, U.S., September 4, 2018. REUTERS/Yuri Gripas/File Photo

NEW YORK (Reuters) – Inflation expectations remain anchored in Mexico as the central bank has tightened monetary policy while unanchored expectations in Argentina will require action “on a number of fronts” a top official at the International Monetary Fund said on Thursday.

“We see inflation expectations still very well anchored in Mexico and it’s right for the central bank to be raising rates,” said Nigel Chalk, acting director of the IMF’s Western Hemisphere department.

Regarding Argentina, where the government this week froze prices of over a thousand household goods until early 2022 in a bid to stem annualized inflation that is running over 50%, Chalk said “we do think that the expectations have become unanchored,” and tackling it “will take actions on a number of fronts, given the different drivers.”

Source: Investing.com

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