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ECONOMY | 30-03-2023 14:31

Argentina's economic growth surpasses expectations despite outlook

Argentina's economic activity rose 2.9% year-over-year, more than economists expected in January.

Argentina's economy performed better than expected in January with moderate growth after four months of contraction, a brief respite for South America's second-largest economy. The country is facing headwinds and investors anticipate they will lead to a recession this year.

Economic activity rose 0.3 percent in January from the previous month, beating economists' expectations of a 0.1 percent decline. However, the data comes from before a severe drought began to hit growth hard. Compared with a year ago, the economy has expanded 2.9 percent, according to government data released by the INDEC national statistics bureau on Wednesday.

The release of the data coincides with the first bilateral meeting between President Alberto Fernández and US President Joe Biden at the White House on Wednesday. They also come as the International Monetary Fund's executive board is projected to approve a new US$5.3-billion disbursement to Argentina as part of the country's US$44.5-billion deal.

Private economists expect Argentina's economy to contract by three percent this year. That contrasts with the IMF's projection of almost two percent growth for Latin America as a whole.

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by Patrick Gillespie, Bloomberg

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