Economic activity dropped 1.2% in April from previous month

Argentina's economy contracted more than expected in April when the start of a new Covid-19 second wave forced the government to apply stricter quarantine measures.

Economic activity fell 1.2 percent from March, more than economists' forecasts of a 0.5-percent decline. However, year-on-year, the economy grew 28.3 percent from April 2020, according to data published on Tuesday by the INDEC national statistics bureau – a legacy of last year’s lockdown imposed to prevent the initial wave of the virus.

Gross domestic product is expected to have contracted in the second quarter, according to the Central Bank's monthly survey of private economists. A brutal second wave of coronavirus reduced part of commercial activity as the government introduced stricter restrictions to tackle a surge in caseloads. 

High inflation, declining consumer confidence, and the farmers' strike in response to the beef export ban likely had an impact on the economy as well, according to analysts.

In the first four months of 2021, economic activity accumulated a year-on-year increase of 8.2 percent, said INDEC.

– TIMES/AFP/BLOOMBERG