Argentina Economic Outlook
December 4, 2018
The Argentine economy is expected to have remained in recession in the third quarter, battered by the turmoil in financial markets and a sharp depreciation of the peso. In the fourth quarter, economic weakness likely persisted although macroeconomic rebalancing continued: Consumer confidence was deep in negative territory in October-November, while the trade balance recorded the second consecutive surplus in October. The delicate economic situation, coupled with rising debt levels, prompted Fitch Ratings to change the country’s outlook from stable to negative, and S&P to lower its rating from B+ to B in the first half of November. Against this backdrop, the Senate approved an austerity budget in mid-November, paving the way for the approval of the second IMF review of the country a few days later which will allow the disbursement of USD 7.6 billion by the end of the year. Moreover, the primary deficit narrowed considerably in January–October, although the overall fiscal deficit widened in the same period due to surging interest payments.Argentina Economic Growth
The economy will likely remain stuck in recession next year, although the contraction should soften. Strong, albeit moderating, inflationary pressures and rising taxes will eat into consumers’ pockets, while high interest rates and shrinking public investment will weigh on fixed investment. That said, the trade balance is set to swing from deficit to surplus, thanks to higher agricultural exports and lower imports, while the fiscal deficit ought to narrow. Downside risks stem from possible capital flight following the Fed’s tightening cycle and the uncertain political outcome in next year’s elections. LatinFocus Consensus Forecast analysts see the economy contracting 0.9% in 2019, down 0.4 percentage points from last month’s estimate, before rebounding to 2.7% growth in 2020.Argentina Economy Data
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Argentina Facts
| Value | Change | Date | |
|---|---|---|---|
| Bond Yield | 6.69 | 0.15 % | Dec 17 |
| Exchange Rate | 37.59 | 0.45 % | Dec 12 |
| Stock Market | 31,081 | 2.26 % | Dec 12 |
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Argentina Economic News
Argentina: Inflation accelerates but effects of stabilizing peso emerge
December 14, 2018
According to the National Statistical Institute (INDEC), national consumer prices rose 3.2% over the previous month in November, coming in well below October’s 5.4% month-on-month increase.
Argentina: Contraction in the industrial sector moderates in October
December 5, 2018
Industrial production contracted 6.8% over the same month of last year in October, according to data released by the National Statistical Institute (INDEC) on 4 December, marking a softer fall than September’s multi-year low 11.5% year-on-year decline. October’s reading again reflected contractions in almost all components of the index.
Argentina: Contraction in economic activity sharpens notably in September
November 26, 2018
The monthly indicator for economic activity (EMAE, Estimador Mensual de Actividad Económica) contracted 5.8% in annual terms in September, a much sharper drop than the revised 1.9% fall recorded in August (previously reported: -1.6% year-on-year).
Argentina: Trade balance records another surplus on plunging imports in October
November 26, 2018
Exports increased 1.4% in year-on-year terms in October, contrasting September’s 4.8% fall.
Argentina: Consumer sentiment declines further in November
November 22, 2018
The Universidad Torcuato di Tella (UTDT) consumer confidence index fell to 32.1 points in November from 32.6 points in October, marking the worst reading since September 2002.
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