Argentina’s economic recovery lost steam in July after the government re-imposed stricter quarantine measures in a failed bid to contain the pandemic.
Economic activity rose 1.1 percent in July from a month earlier, after two months of stronger gains as the economy rebounded from a historic drop in April. Activity fell 13.2 percent from a year earlier, worse than economists’ expectation for a 11.5 percent contraction.
Manufacturing, transportation and retail sectors saw activity fall during the month, while construction, hotels and restaurants posted minor gains.
In the first half of July, President Alberto Fernández put strict lockdown measures back in place to try and contain the virus. Since then, the nation has slowly eased restrictions, though many curbs remain in place. Argentina has recorded record days of deaths and new cases in recent weeks as the virus spreads to the nation’s interior provinces.
With analysts seeing no positive drivers in sight, Argentina’s economy is forecast to contract 12 percent this year, according to the government’s budget proposal, which would be its worst one-year contraction on record. Inflation remains above 40 percent and unemployment is at a 16-year high.
by Patrick Gillespie, Bloomberg