Economic activity in Argentina slowed in July amid uneven recovery

Argentina’s economy expanded up more than expected in July as Covid-19 cases and lockdown restrictions continued to ease.

The economy grew 11.7 percent in July from a year ago, faster than the 8.5 percent median estimate of analysts surveyed by Bloomberg. Activity in July expanded 0.8 percent on a monthly basis, a slower pace from June, according to government data published Tuesday.   

All but two sectors posted annual gains in July. Argentina’s hotels and restaurants saw activity grow 55 percent, while construction and manufacturing also recorded double-digit gains. 

The recovery has sputtered at times this year as elevated inflation, a massive Covid wave and some export restrictions worsened an already challenging business environment. President Alberto Fernández is seeking to increase government spending before a midterm vote in November, potentially complicating the economic outlook and an agreement with the International Monetary Fund. 

His government expects the economy to grow eight percent this year, boosted by the base effect of the economy’s steep decline last year. Private economists see an expansion of 7.2 percent, according to the Central Bank’s monthly survey.