Argentina: Economic activity growth plummets to a near nine-year low in May
July 24, 2018
The monthly indicator for economic activity (EMAE, Estimador Mensual de Actividad Económica) contracted 5.8% in annual terms in May, which was below the revised 0.6% fall recorded in April (previously reported: -0.9% year-on-year) and marked the worst performance in nearly nine years.
The contraction came on the back of a significant decline in agriculture, livestock, hunting and forestry activity, which plunged 35.2% in May (April: -30.3% yoy; previously reported: -30.8% yoy). The sector has been hit hard in recent months by the effects of the drought on crop yields. In addition, growth in the manufacturing industry fell 1.4% in May (April: +2.8% yoy; previously reported: +3.1% yoy), and construction activity growth slowed to 4.4% (April: +10.3% yoy; previously reported: +10.2% yoy). Meanwhile, activity in the financial intermediation sector accelerated to 10.8% growth in May (April: +8.4% yoy; previously reported: +9.4% yoy).
A seasonally-adjusted month-on-month comparison shows that economic activity contracted 1.4% in May following April’s 2.8% drop.
Lastly, average economic activity decreased to 2.7% in May from 3.5% in April.
Argentina GDP Forecast
FocusEconomics Consensus Forecast panelists expect economic growth of 0.9% in 2018, which is down 0.8 percentage points from last month’s forecast. For 2019, panelists see the economy expanding 2.1%.
Author: Lindsey Ice, Economist