Argentina’s economy expected to experience sharpest decline since 2020 in March

According to a Reuters poll, Argentina’s economic activity index is anticipated to have decreased by 6.9% year-on-year in March, marking the deepest decline since 2020 and the fifth consecutive monthly contraction. The survey of 13 local analysts also suggests that the index fell by an estimated 7.2% in March compared to February, with contraction estimates ranging from 4% to 10.3%.

Economist Pablo Besmedrisnik from consulting firm Invenomica noted that the decline in sectors related to domestic consumption, industry, and construction is continuing to worsen. However, there are some sectors like mining and agriculture that are showing growth. The country’s industrial production indicator also revealed a significant 21.2% decrease year-on-year in March, as per government data.

Despite the challenging economic conditions, economists are cautiously optimistic about a gradual recovery in the second half of the year. Federico Gonzalez Rouco, an economist at Empiria Consultores, stated that while they do not anticipate a rapid recovery in activity for the first half of the year, there are signs of inflation deceleration. However, risks related to the foreign exchange market continue to pose challenges.

Official figures from the statistics agency INDEC are expected to be released on Wednesday. Hernan Nessi reported on the survey results, highlighting the ongoing economic challenges facing Argentina and the cautious optimism for a gradual recovery in the coming months.