A report indicates low expectations that Argentina will emerge from recession in the short term

Despite the Overflowing optimism that exudes the economic teamArgentina still has a long way to go good stretch to travel downhillbefore recovery. For example, Leader Index prepared by the Center for Research in Finance (CIF) of the Torcuato Di Tella University assigns it only 3.57% chances of a change of cycle in the next six months.

The index is compiled based on the results of a dozen economic indicators: the Merval, the General Stock Market Index, the monetary base, the price of soybeans, sales of new cars, VAT collection, cement shipments, industrial production of non-metallic minerals, and industrial steel production.

Of them, in August Only four showed positive data. which were monetary-based, steel production, consumer confidence and auto sales. The rest continued to decline.

The August Leader index was 14.67% below the level it had in August 2023 and fell 0.26% compared to July. “The probability of leaving the recessionary phase in the coming months is 3.57%,” says the UTDT report.

In this sense, the data confirm that The exit from the recessionary process that the economy is undergoing will not end in a V shape as several leading economists have pointed out. at the beginning of Javier Milei’s mandate.

That sin of optimism contrasted here with An economy that shows signs of moving through the valley floor, but is struggling to get back on track. It is what many defined as a V with one of the arms at 45%.

The economist Lorenzo Sigaut Gravina told Ambito that “growth in 2025 is linked to whether there is foreign currency”. “We have to think that we are coming from two years of decline, so talking about growing 5 points means recovering from the fall of 2023 and 2024. “It wouldn’t be that crazy,” he explained.

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Sigaut Gravina considered that “it is more difficult to grow 5 points in genuine terms” and warned that “with the appreciated exchange rate and without COUNTRY TAX A lot of foreign currency will be needed to import and it is not known “They will be there if the government fails to roll over the debt.”

“If refinancing is not achieved, the Central Bank will have to pay cash. and it is also an election year where the ‘wait and see’ (of investors) will probably operate,” explained the professional. In this way he considered that after that moment there will be a recovery but he raises doubts about whether it will be a very vigorous process.

The Epyca consulting firm raises the issue of dollars for next year. The government is beginning to make explicit that it needs foreign currency. “Minister Luis Caputo, at the Rosario Stock Exchange, asked that more Argentines join the money laundering process and use their ‘dollars under the mattress.’ He also announced that they hope to hold new negotiations with the IMF for the generation of new disbursements, which would be used to ‘rebuild the reserves and balance of the BCRA'”, the consultant points out.

He adds that “In the first six months of 2024, GDP fell 3.4%; but the non-agricultural and non-mining sectors collapsed -7.3% year-on-year.” “This is something pworrying, because the misinterpretation of statistics (or its capricious manipulation, as Argentina experienced with the INDEC during the governments of Cristina Fernández) leads to the implementation of economic policies on a reality that does not exist“,” the report warns.

For its part, the cconsultancy Labor, Capital & Growth (LCG), sReferring to the problem of the lack of foreign currency, he maintains that “dollar accounts will continue to be under pressure, especially if the dollar continues to appreciate (that is, if inflation rates are above 2%) and if the Country Tax for purchases of products from abroad is eliminated at the end of the year.”

He argues that it is clear that the Market fears “remain valid” not because of a possible insolvency due to lack of payment capacity, but rather because of the possible iInability to obtain dollars for payments of the debt services in that currency.” In this regard, in the speech at the Rosario Stock Exchange Caputo said on Friday: “this time there will be no crisis” by ruling out a currency run in the future.

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