In fact, already in the data for the seventh month of the year a certain contraction is observed in the monthly comparison. “In the indicators for July, when they are adjusted for seasonality to see the monthly variation, a certain weakness begins to be seen. Above all, it is observed in some advanced industry indicators, such as that of Fiel and Ferreres. And also the indicator of energy consumption used by CEPXXI, which fell”, Santiago Manoukian, Head of Research at Ecolatina, explained to Ámbito.
“We also see it in the taxes associated with economic activity, which in July, adjusted for seasonality, registered a monthly fall. And also in an indicator that we follow, which is the OECD Tracker, which is used to follow economic activity in the short term, and there if the series is adjusted, a drop is seen. So we expect a seasonally adjusted monthly drop in July”, detailed Manoukian.
“In the first half of the year, Argentine economic activity had a dynamism that was above forecasts. This was due to the fact that the exceptional improvement in the terms of trade generated additional income, which not only made it possible to offset the effects of the drought, but also to finance the expansion of other sectors, such as the manufacturing industry”, explained Eugenio Marí. , Chief Economist of the Fundación Libertad y Progreso.
“Nevertheless, Starting in July, we expect that a slowdown will begin to be evident and that, later, we will even begin to register negative variations in activity as we enter the fourth quarter. This has its explanation in structural factors of the Argentine economy, which does not generate certainty or have rules of the game that underpin investment. As a consequence, the Argentine potential GDP is stagnant and the activity moves cyclically around this level”, detailed the economist.
Marí also highlighted the “conjunctural issues” that will impact the activity. “The international economic cycle is reversing, which will affect emerging economies, such as Argentina. And also our own economic policy, which still has a pending task to show signs that fiscal and monetary imbalances are going to be adjusted”, he stressed.
projections
“For this year we are projecting a growth of 3.8% in the annual average”, Manoukian pointed out, adding: “If economic activity maintained the same level as June 2022 for the rest of the year (recent data from EMAE), the economy would grow around 5% in the year, therefore, we are estimating a negative advance in seasonally adjusted terms for the second semester”.
“The prospects for the last part of the year will be colored by a greater impact of the inflationary acceleration on income (mainly self-employed, informal and sectors more dependent on transfers from the State), an adjustment of public service rates that will subtract disposable income, a higher cost of consumer credit and investment due to the adjustment in rates and a lower fiscal impulse due to the need to accelerate fiscal consolidationl”, added the Ecolatina analyst.
For its part, as pointed out by the consulting firm LCG when analyzing the June EMAE data, for the coming months it is expected “a slowdown in the annual growth of activity”. “The political instability as a result of the internal problems of the coalition translated into exchange rate instability and a jump in inflation that sooner rather than later will have a drag on activity. Added to this are the more severe restrictions on imports given that the BCRA is not being able to reverse the contractionary dynamics of reserves and the cut in spending in order to reach (or come close to) the fiscal commitment agreed with the IMF. Thus, we project a growth in activity between 3%-3.5% annual average which, discounting the statistical drag left by the recovery of 2021, would be equivalent to a fall of 3.3% measured between ends”.
Source: Ambito
David William is a talented author who has made a name for himself in the world of writing. He is a professional author who writes on a wide range of topics, from general interest to opinion news. David is currently working as a writer at 24 hours worlds where he brings his unique perspective and in-depth research to his articles, making them both informative and engaging.
