Economic activity cut short the recovery process in June which seemed to have started in May when it registered a contraction both in monthly and interannual terms. The poor performances of the manufacturing industry, trade and construction explained the bulk of the fall.
According to data from the Monthly Estimator of Economic Activity (EMAE) published this Wednesday by INDEC, the economy fell 3.9% compared to June 2023when in May it had shown an improvement of 1.9% compared to the same month last year.
Winners and losers
The iIndustry and trade were the two sectors that had the greatest impact on this decline. In the first case, the annual decline in production accelerated from 14.2% to 20.4%, while in the second case the increase was from 11.4% to 18.6%.
Behind these two items was the constructionwith a reduction in its activity of 23.6%. In May the decrease had been 22.1%.
The loss of purchasing power of the population, which hit the capacity of internal consumption, and the paralysis of public works were the main factors that accentuated the recession.
At the other extreme, the three sectors that were most successful in cushioning the average fall in the economy were: agriculture (+82.4%), mining and hydrocarbons (+4.6%) and fishing (+34.8%).
Excluding agriculturewhich shows high growth rates due to a deep drought in 2023, The economy contracted 8.8% year-on-year in June.
Three quarters in a row of recession: no “V” rebound
In addition, Compared to May, economic activity fell by 0.3%It is worth remembering that in May the EMAE seasonally adjusted series had shown its first monthly improvement since October 2023.
With these variations, in the cumulative total for the first half of the year the indicator that works as a proxy for the evolution of the Gross Domestic Product (GDP) registered a drop of 3.2% and 6.6% if agriculture is excluded of the equation.
Meanwhile, The average level of activity in the second quarter was 1.7% lower than in the first quarterThis was the third consecutive quarter with red numbers.
The first data for July were more encouraging
Some reactivation is expected for Julyaccording to the first data that became known. For example, automotive production grew 38.7% monthly, agricultural machinery manufacturing showed advances of more than 50% in all its segments, and cement shipments increased 25.9%.
Source: Ambito
