Argentina: Economic activity falters in March

The monthly indicator for economic activity (EMAE, Estimador Mensual de Actividad Económica) slowed notably in March, registering a 1.4% expansion in annual terms, a sizeable moderation from February’s revised 5.0% increase (previously reported: +5.1% year-on-year). This was the slowest pace of growth since April 2017; it nonetheless marked the thirteenth consecutive month of economic expansion in Argentina.

The slowdown was driven by contractions or weaker growth in most of the components of the index. Notably, economic activity in agriculture, livestock, hunting and forestry contracted 5.5% year-on-year in March (February: +3.3% yoy). Meanwhile, growth in the manufacturing industry eased to 0.8% (February: +5.9% yoy). Construction activity also slowed, expanding 5.9% in March (February: +12.7% yoy), and financial intermediation growth moderated to +3.3% (February: +7.6% yoy).

A seasonally-adjusted month-on-month comparison showed that economic activity contracted for the second consecutive month, falling 0.1% in March, following a 0.2% contraction in February.

Lastly, average economic activity in March remained unchanged at February’s two-year high of 3.6%.

Argentina GDP Forecast

FocusEconomics Consensus Forecast panelists expect economic growth of 2.3% in 2018, which is down 0.3 percentage points from last month’s forecast. For 2019, panelists see the economy expanding 3.0%.