MercoPress. South Atlantic News Agency

Argentine consumers' expectations decline to lowest since 2003

Public opinion perception and expectations about the Argentine economy are currently going through the most serious declination since the Kirchner couple first reached government in 2003.

Former president Nestor Kirchner took office on May 25 that year and four years later, on December 10, his wife Cristina Fernandez de Kirchner became president after having been elected at the end of October with no need of a run off. "When the conditions of the Argentine economy are assessed, the conclusion is that there's a 5% positive declination and a 10% drop in expectations", said Susana Nutti leading economist from the consulting Mercado Foundation firm. The estimates refer to a survey and comparison the consulting firm elaborates monthly. Public opinion negative expectations regarding the evolution of inflation "have not ceased to grow" in the last two years and have intensified following the long unresolved conflict between the Kirchner administration and farmers' organizations. Nutti says that given the "growing uncertainty, people are taking precautions and refuge in certain variables" which helps to explain the rapid slowdown of consumption which has been recorded lately even in those segments of the Argentine economy which continue to expand. The economist said that government policy has been for several years now to encourage consumption but the latest surveys show that "sales plans are down". "The model based on domestic consumption and boosting exports was pushing strongly and managed to remain as such with an over stimulation of consumption", said economist Nutti, but people are far more cautious on how they spend their money, on debt and "we believe they are saving or changing liquid assets to other currencies".