Argentina Government Consumption

Economic growth decelerates in the first quarter of 2026

GDP reading: Argentina's GDP expanded 0.7% in seasonally adjusted quarter-on-quarter terms in Q1, following 1.2% growth in the previous quarter.

Drivers: Relative to the previous quarter's data, readings in Q1 softened for private consumption (+0.8% on a seasonally adjusted quarter-on-quarter basis vs +1.1% in Q4), government consumption (-2.4% vs -0.1% in Q4), exports of goods and services (-3.1% vs +5.2% in Q4) and imports of goods and services (-2.5% vs +0.4% in Q4). In contrast, the reading for fixed investment improved in Q1 (-1.7% vs -3.4% in Q4). On a year-on-year basis, economic output expanded 2.3% in Q1, following a 2.2% expansion in the previous quarter.

Panelist insight: Digging deeper into the data, Goldman Sachs’ Sergio Armella said: “The performance of the economy was better than expected in the first quarter of 2026 supported by private consumption and robust exports. Activity in the primary sector continues to drive growth while the secondary sector and the more labor-intensive tertiary sector are lagging. Both real GDP and private consumption reached record highs. Investment, however, remains below its level when President Milei took office and is close to 20% below its 2017-2018 peak.” On the outlook, Itaú Unibanco analysts said: “We forecast GDP growth of 3.5% in 2026, led by primary sectors, particularly agriculture, energy, and mining. The ongoing disinflation process and lower interest rates should underpin a recovery in real incomes and, consequently, private consumption. Private investment is projected to eventually turn the corner, although annual contractions in imports of capital goods suggest the trough has yet to be met.” 

How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Argentine government consumption projections for the next ten years from a panel of 35 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable government consumption forecast available for Argentine government consumption.

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