Argentina's Economic Activity Decline

Economic activity in Argentina registered a drop of 3.2% in February compared to the same month in 2023, and 0.2% compared to January 2024, the official Indec institute reported.

Eight sectors of activity registered falls in the year-on-year comparison, among which construction (-19.1%) and financial intermediation (-12.1%) stand out, along with manufacturing industry (-8.4%) and wholesale trade, retail and repairs (-5.5%)

Compared to the same month in 2023, seven sectors registered increases in February, among which fishing (31.6%) and mining and quarrying (11.7%) stand out.

Economic activity had fallen 4.5% year-on-year in December and 4.3% in January, according to data from Index itself.

President Javier Milei had celebrated the first quarter with a fiscal surplus that Argentina has recorded since 2008 as a "historic feat."

The Index data, added to an inflation that reaches almost 290% year-on-year, reflect a scenario of "stagflation" (inflation and recession) that Milei himself had predicted when he took office in December.

The International Monetary Fund itself, of which Argentina is the largest debtor, as well as the World Bank more recently, have called the Argentine president's attention so that the harshness of the adjustment does not affect "the most vulnerable."

Indec places the poverty rate for the second half of 2023 - the latest data available - at 41.7%, while a study by the Catholic University estimates poverty in January at almost 57%.

The activity index is released on the same day that a massive student march against the budget adjustment in public universities takes place and on the eve of another mobilization called for May 1 by the labor confederations.