Argentina economic activity growth slide: Merchandise exports grow at a milder rate

By FocusEconomics

BUENOS AIRES, Argentina – The monthly indicator for economic activity (EMAE) expanded 4.5 percent in year-on-year terms in October, which followed September’s 4.6 percent increase. October’s figure marked the worst reading since February 2021.

The slowdown was largely due to a deterioration in the agriculture sector. In addition, the manufacturing sector lost steam. Lastly, activity in the hotels and restaurants sector gained pace, while transport and communications output grew.

On a monthly basis, economic activity fell 0.3 percent in October, which was below September’s 0.2 percent fall and marking the worst result since March. Meanwhile, the trend pointed down, with the annual average growth of economic activity coming in at 6.7 percent in October, down from September’s 6.9 percent reading.

FocusEconomics analysts see the economy growing 2.2 percent in 2023, unchanged from the previous month’s forecast. In 2024, analysts see GDP expanding 2.2 percent.

Meanwhile, merchandise exports grow at a milder rate in November.

Merchandise exports jumped 14.5 percent annually in November, on the heels of October’s 15.1 percent upturn. Meanwhile, merchandise imports were broadly stable, falling just 0.3 percent on an annual basis in November (October: +15.8% yoy), marking the weakest reading since October 2020.

As a result, the merchandise trade balance deteriorated from the previous month, recording a US$1.3 billion surplus in November (October 2022: US$ 1.8 billion surplus; November 2021: US$ 0.4 billion surplus). Lastly, the trend pointed up, with the 12-month trailing merchandise trade balance recording a USD 6.1 billion surplus in November, compared to the US$ 5.2 billion surplus in October.

Panelists participating in the LatinFocus Consensus Forecast expect merchandise exports to increase 2.5 percent in 2023 and merchandise imports to expand 2.8 percent. For 2024, the panel expects merchandise exports to increase 4.4 percent and merchandise imports to grow 5.1 percent.