Economic activity down 1.7% year-on-year in August

Economic activity contracted by 1.7 percent in August compared with the same month of 2025, according to the INDEC national statistics bureau.

The fall was the steepest year-on-year monthly decline recorded so far in 2026.

Overall, economic activity remains in positive territory over the first eight months of the year, rising 1.2 percent compared with the January-August period of last year. The contraction was also the steepest in two years, when economic activity contracted by 2.4 percent in September 2024.

On a seasonally adjusted basis, the index edged up by 0.1 percent from July. The trend-cycle series, which filters out seasonal factors and other short-term fluctuations, remained unchanged.

Manufacturing and trade recorded the largest monthly contractions, shrinking by 3.2 percent and 3.5 percent, respectively.

Despite the figures, Economy Minister Luis Caputo sought to highlight the monthly increase, pointing out that the trend-cycle indicator stood 6.6 percent above the December 2023 level.

Mining continued its upward trajectory, growing by 11.1 percent year-on-year. Electricity, gas and water services expanded by 4.3 percent, making them the two fastest-growing sectors in the annual comparison. Hotels and restaurants ranked third, with growth of 3.1 percent.

Meanwhile, 10 sectors recorded year-on-year declines, led by fishing, which fell by 15.7 percent.

The agricultural sector also attracted attention, contracting by one percent after 12 consecutive months of growth. This was the sector’s sharpest decline since September 2023, when activity fell by 1.8 percent.

The Centre for Economic Policy Studies (CEPEC) think tank highlighted the limited growth, particularly given expectations of a rebound following July’s sharp contraction.

“Economic activity fell by 1.7 percent year-on-year in August, a much worse result than expected. The seasonally adjusted series barely recovered from July’s steep decline, which itself was barely revised. Meanwhile, cumulative year-on-year growth stood at 1.2 percent,” the centre said.

“Growth forecasts for 2026 could be revised downwards again. Economic activity is increasingly close to jeopardising the positive statistical carry-over from 2025. In other words, the growth inherited from last year may no longer be enough to sustain projections unless the economy manages to regain momentum,” it added.

– TIMES/NA