Argentine economic activity grew by 4% in June as the economy recovers
The INDEC ( Argentina Statistic Department ) reported the Monthly Estimates of Economic Activity, which in June recorded the highest rate of expansion of the new Macri government era.
Economic activity began to accelerate growing by 4% on a year-on-year basis, the highest monthly rate recorded to date under the management of President Mauricio Macri, driven by construction, general industry, and the financial sector, according to the National Institute of Statistics and Censuses ( INDEC ).
Between January and June 2017, economic activity had a cumulative expansion of 1.6% compared to the same period last year, according to this interim data.
In its Monthly Economic Activity Estimator (EMAE) for June, the statistical agency provided a ratification of the recovery cycle of the activity, supported by a continuous investment in the construction sector and industry
The Ministry of Finance said that “the growth was across the board “since it was detected in 14 of the 15 sectors surveyed by INDEC, which was reported in the second quarter of the year, compared to the same period in 2016.
“Growth in the construction sector was 13.2% year-on-year, with the highest increase since June 2010, and a record 6.2% in the manufacturing industry, the largest increase since September 2011,” said the INDEC.
Meanwhile, the sectors linked to consumption, such as commerce had 4.4% year-on-year growth and hotels and restaurants 5.7% year-on-year, also growing significantly.
“With the June data in it confirms that the growth process is being consolidated. There are now four consecutive quarters of growth since in the second quarter of the year the activity level increased 0.8% with no seasonality compared to the previous quarter and 2, 7% compared to a year ago, “assessed the Argentine economist Nicolas Dujovne.
Horacio Larghi, director of the Invenómica consultant, told Reuters that June’s growth is “the highest of the year and represents four consecutive months of (year-on-year) expansion .”
It should be recalled that in February of this year the EMAE had reflected a decrease of 1.2% compared to the same month of 2016.
In June, five sectors representing 44% of GDP remained in recovery stage
He added that ” investment has been the engine of growth in June, with a strong recovery in the construction and industrial industries. Despite this, consumption is the most relegated variable and is the factor that explains the slow recovery of the economy”.
The government of President Mauricio Macri predicts that in 2017 the economy of the country will slightly surpass 3% growth, while the World Bank anticipates an increase of 2.7%.
Meanwhile, the International Monetary Fund predicted a more modest economic expansion, of 2.4% for Argentina in 2017, according to the director of the Western Hemisphere Department of the entity, Alejandro Werner.
Over 15 branches of activity, the June level meant continuity in the recovery phase compared to the level recorded in the same month of 2015 : construction, agriculture, industry, commerce and the financial sector, which together account for 44% Of GDP ; While 9 entered the growth cycle: fishing, electricity, gas and water, hotels and restaurants, transportation and communications, real estate, public administration, education, health, and personal services. They represent 53% of GDP. While the mining and quarrying industry continues to recede, it contributes the remaining 3% to total GDP.
EXPECTATIONS FOR JULY
The first estimate by the private sector for July of the General Activity Index of the consulting firm Orlando Ferreres showed an increase of 0.6% in the month and 5.4% in the inter-annual comparison.
As has been the case since the beginning of the positive changes since last March, the general activity indexes show that the economy is advancing on the recovery path.
Source: Translated from Infobae