Argentina’s economy shrank in February from January, snapping a nine-month growth streak following a historic plunge triggered by the pandemic.
Economic activity fell one percent on a monthly basis in February, the first contraction since last April, according to data published by the INDEC national statistics bureau on Thursday. From a year ago, the economy contracted 2.6 percent, more than the 2.3 percent decline economists had projected.
The country’s already fragile recovery is facing headwinds as a new wave of the pandemic surges nationwide, with new Covid-19 cases shattering previous records. Argentina recently surpassed more than 60,000 deaths from the virus as total cases near 2.8 million. President Alberto Fernández’s government implemented new restrictions to circulation in April, forcing most citizens to stay at home between 8pm and 6am daily.
The economy didn’t gain much momentum in March either. Amid accelerating inflation, Argentina’s trade surplus narrowed last month as a surge in imports ebbed at export growth. The US$400-million trade surplus was half of that seen in January or February.
Argentina’s economy is expected to grow this year for first time since 2017. Economists forecast gross domestic product to increase 6.7 percent in 2021, while inflation could end the year at 46 percent.
by Patrick Gillespie, Bloomberg