Economic activity in Argentina fell 8.4% in March, the biggest decline since 2020

Argentina’s economic activity fell 8.4% in March from a year earlier, the country’s official statistics agency said on May 22, the fifth monthly decline in a row and the sharpest drop since 2020.

The result was a steeper decline than the 6.9% drop estimated by market analysts in 2012 Reuters poll, which underlines the impact of libertarian President Javier Milei’s cost-cutting policies since he took office in December. Mr Milei has embarked on a painful austerity campaign to reduce rising poverty and annual inflation to almost 300%.

Nine sectors recorded a year-on-year decline, led by the construction sector which recorded a decline of 29.9% and the manufacturing sector which recorded a decline of 19.6%, according to data published by Argentina’s statistics agency INDEC.

Economic activity figures are seen as a useful early indicator of likely gross domestic product (GDP) outcomes.

The drop in activity in March follows a year-on-year decline of 3.0% in February and 4.1% in January.

During the year to March, economic activity in Argentina fell by 5.3%.