June 3, 2015 / 11:31 PM / 4 years ago

IMF says Argentine economic data still flawed, extends review for a year

WASHINGTON, June 3 (Reuters) - Argentina has failed to take sufficient steps to bring the quality of its economic statistics in line with global standards, the International Monetary Fund’s board said on Wednesday.

The IMF, which requires accurate data to analyze the world’s economies, censured Argentina in 2013 over failing to improve its inflation and gross domestic product figures, putting the country at risk of official sanctions that could have barred it from voting on IMF policies and from accessing financing.

The IMF later signaled that Latin America’s third-largest economy was making progress in improving its data quality and gave it a timeline for improvements, which it said on Wednesday had not been completely met.

“It determined that Argentina is not yet in full compliance with its obligation under Article VIII, Section 5 with respect to the accurate provision of CPI and GDP data to the Fund,” the board said in a statement.

The IMF said it would extend the review by a year.

The IMF said in December that Argentina had made progress in rectifying its data standards, although many analysts and private economists continued to doubt the credibility of the data.

Critics of the government say the country’s second default in 12 years in 2014 worsened the outlook for the already struggling economy and prompted the government to present more optimistic figures in an effort to calm markets and consumers.

Analysts accused Argentina’s government of under-reporting inflation since early 2007 for political gain and to reduce payments on its inflation-indexed debt. The country agreed to revamp its consumer price index last year in a bid to win back the trust of financial markets.

But the new index continues to clock inflation at well below analysts’ estimates, and the government has stopped listing the products measured, raising questions over how much the data is being dragged down by price controls that the administration puts on scores of food and household items.

Official data last month showed inflation eased to 1.1 percent in April from 1.3 percent in March, taking annual inflation to 15.8 percent. That is lower than private estimates of more than 20 percent and one of the highest levels in the world, prompting fiery protests demanding hikes in wages. (Reporting by David Chance and Anna Yukhananov; Editing by Leslie Adler)

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