Market Expectations Survey (REM)

Report of the main macroeconomic forecasts according to the monthly survey.

This report, published on May 7, 2024, disseminates the results of the survey carried out between April 26 and 30, 2024. Forecasts from 39 participants were considered, including 26 local and international consulting firms and research centers and 13 financial institutions in Argentina.

In the fourth survey of the year, REM participants estimated monthly inflation of 9.0% for April (-1.8 p.p. compared to the previous REM). For May, they estimated monthly inflation of 7.5% and for the year of 161.3% y.o.y. (-1.5 p.p. and -28.0 p.p. in relation to the previous survey, respectively). Those who best forecast this variable in the past (Top-10) expected inflation of 8.9% for April, 7.1% for May and 156.5% y.o.y. for 2024. Regarding the Core CPI, the REM participants as a whole placed their forecasts for 2024 at 145.1% YoY (-33.9 p.p. than the previous REM).

In the April survey, the REM analysts projected a level of real Gross Domestic Product (GDP) for 2024 3.5% lower than the average for 2023, maintaining the outlook with respect to the previous survey. Meanwhile, those who make up the Top-10 projected, on average, a reduction of 3.7% in the year. The fall would have been concentrated in the first quarter, a period for which those who respond to the REM estimated a seasonally adjusted quarterly reduction of 3.4% of GDP. According to the forecasts received, the level of activity would stop contracting as of the second quarter of the year and would begin to recover in the third, with a rise of 0.6% quarter-on-quarter s.e. By 2025, the REM participants as a whole estimated an average growth of 3.4% y.o.y.

The open unemployment rate for the first quarter of the year was projected at 7.0% of the Economically Active Population (EAP), implying a reduction of 0.1 p.p. compared to the previous REM. For the Top-10, the unemployment rate would stand at 7.1% in the same period. The REM participants as a whole expect an unemployment rate of 7.6% for the last quarter of 2024.

REM participants forecast a BADLAR rate of private banks for May of 50.5% TNA (equivalent to a monthly effective rate of 4.2%) and a decrease to 40.0% TNA in December. Those who make up the Top-10 predicted, on average, that it would stand at 49.9% in May.

The median of the REM’s nominal exchange rate projections stood at $886.6 per dollar for the May 2024 average (-$43.4 per dollar compared to the previous REM). For the Top-10, the average nominal exchange rate expected for May is $888.1/USD. The year-on-year variation to Dec-24 implied in the forecasts stood at 102.5%, 21.5 p.p. lower than the previous REM.

Regarding foreign trade in goods, those who participate in the REM estimated that by 2024 exports (FOB) will total USD78,966 million and imports (CIF) USD62,897 million, both correcting downwards compared to the previous survey (-USD1,876 million and -USD2,265 million, respectively).

Finally, the projection of the primary fiscal surplus of the National Non-Financial Public Sector (NFPS) made by those who participate in the REM stood at $4,420 billion for 2024 ($504 billion lower than the previous REM). The Top-10 average forecasts a primary surplus of $3.485 billion by 2024.