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ECONOMY | 22-08-2019 19:29

Economy stagnated in June, with activity down 2.6% in first half of 2019

Data from the INDEC national statistics bureau on Thursday indicated that economic activity in Argentina did not alter in June with respect to the same month the previous year.

Data from the INDEC national statistics bureau on Thursday indicated that economic activity in Argentina did not alter in June with respect to the same month the previous year.

The report confirmed therefore that economic activity in Argentina contracted by 2.6 percent in total.

INDEC's Monthly Economic Activity Estimator (EMAE), meanwhile, showed a 0.4% percent decline in activity compared to May. 

Argentina's economy has been in recession since 2018 and its gross domestic product (GDP) slumped 2.5 percent last year. The International Monetary Fund (IMF) anticipates a 1.3-percent decline in 2019, though it is expected to revise that projection downwards in the coming weeks. A recent Central Bank survey of economists forecast a contraction of 1.9 percent.

Consultancy firms also anticipate higher contractions in economic activity the coming months, especially after last week's 20-percent devaluation in the the value of the peso following the PASO primaries. Consumption levels, meanwhile, are also in decline.

Leading interannual falls in the June data was financial services (down 15 percent), followed by electricity, gas and water (down 10.6 percent) and wholesale, retail and repairs (down 8.6 percent). Construction dropped 7.9 percent and manufacturing 6.1 percent.

In comments reported by Reuters, President Mauricio Macri confirmed Thursday that a team from the International Monetary Fund would arrive in Argentina next week, to review the government's economic programme and work on the disbursement of the next installment of the record US$57-billion Stand-By agreement agreed with the Fund in 2018.

– TIMES/NA

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