In March, Argentina’s economic activity index is expected to have contracted by 6.9% year-on-year, according to a Reuters poll conducted on Tuesday. This marks the fifth consecutive monthly decline and the deepest drop since 2020. The index is estimated to have slipped by 7.2% from February, with year-on-year contraction estimates ranging from 4% to 10.3%, indicating a significant downturn.
Pablo Besmedrisnik, an economist and director of the consulting firm Invenomica, highlighted that the decline in sectors related to domestic consumption, industry, and construction is both consolidating and deepening. However, there are some sectors such as mining and agriculture that are showing signs of growth amidst the economic challenges facing the country. The industrial production indicator revealed a 21.2% slowdown year-on-year in March according to government data.
Despite some sectors showing growth, economists remain cautious about the economic outlook for Argentina. They predict a gradual recovery in the second half of the year rather than a rapid turnaround in the first half. Federico Gonzalez Rouco, an economist at Empiria Consultores emphasized that while inflation is decelerating there are still risks associated with the foreign exchange market that need to be monitored closely.
Official figures from the statistics agency INDEC are expected to be released on Wednesday shedding more light on the state of Argentina’s economy in March with ongoing challenges in various sectors; therefore, it may take a long and gradual road towards recovery for South America’s fourth largest economy
