Martín Lousteau warned that the government chose to delay the exchange rate and questioned the economic direction.
In a recent interview, Martín Lousteau analyzed the key decisions of Javier Milei's economic team and asserted that the government chose to delay the exchange rate to contain inflation, even though this strategy is slowing production and deteriorating the level of activity.
"The government faced a dilemma and chose to severely delay the exchange rate," Lousteau stated, warning that this decision was neither a mistake nor a consequence, but a deliberate policy. In his assessment, the current economic model prioritizes adjustment over recovery.
Martín Lousteau explained that the government implemented a sharp devaluation upon taking office, which generated a spike in inflation . According to the senator, this price shock was used to implement a fiscal adjustment : "With inflation, you could have made an adjustment," he said. He added that "a quarter of the fiscal result is explained by the adjustment for retirees ."
In addition to the pension cuts, he noted that there were adjustments in key areas such as health, education, infrastructure, and public salaries. "Everything went up, but since you didn't have a budget, you decided not to support that spending increase," Lousteau summarized. In this regard, he questioned whether the accounts were balanced through the deterioration of social spending.
"The problem isn't when you have a competitive exchange rate. Devaluation occurs when you delay the exchange rate," Lousteau warned. For the senator, the exchange rate has fallen behind inflation, and that's preventing the economy from growing today.
"The exchange rate lag prevents the economy from traction or production," he explained. In his view, this strategy also fails to generate conditions for exports or attract investment, which deepens the recession.
Martín Lousteau asserted that Javier Milei 's government decided to use the dollar as a nominal anchor to accelerate the decline in inflation. "You're lowering inflation faster, but at the cost of freezing the economy," he said.
The legislator emphasized that the implemented adjustments are not sustainable over time. "You can show that the accounts are in order, but if you do so by destroying the state's capacities, it's useless," he said.
In closing his analysis, Lousteau insisted: "This is a government that always chooses austerity. But that path is already showing its limits."
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