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Macroeconomic outlook report: Argentina

Second quarter of 2017

During the second quarter of 2017, Argentinian GDP registered an increase in its y/y growth of 2.27 p.p. when compared to the previous quarter, reaching a value of 2.68%. Higher domestic demand growth was the main driver of the performance of GDP in this quarter. In 2Q17, the unemployment rate decreased 0.50 p.p. from the previous quarter, standing at 8.70%. The Argentinian peso recorded devaluation with respect to the US dollar to an exchange rate of 15.72 pesos per dollar in 2Q17. Inflation decreased for the fourth consecutive quarter, reaching a 23.28% rate.

Macroeconomic overview

  • During the second quarter of 2017, Argentinian economic growth increased by 2.27 p.p. to a y/y growth rate of 2.68%. Thus, the Argentinian economy consolidated the recovery that began in 1Q17. Higher GDP growth was supported by the acceleration of domestic demand, as external demand registered weaker growth in this quarter.
  • Domestic demand accelerated by 3.12 p.p. when compared to 1Q17, standing at a 4.93 y/y growth rate in 2Q17. Private consumption, public consumption and investment in fixed capital all contributed to this increment recording higher growth rates.
  • Regarding the labour market, the unemployment rate of 2Q17 was 0.50 p.p. below that of the previous quarter, recording an 8.70% rate. This increase was caused both by an increase of the number of employed workers with respect to 1Q17, as well as by a decrease of the labour force during the same period.
  • During 2Q17, the Argentinian currency depreciated by 0.05 pesos against the dollar, recording an exchange rate of 15.72 pesos per dollar, thus continuing the trend that started in 2008. The elimination of the currency controls in the end of 2015 has led to an inflow of foreign currency, which has resulted in a devaluation of the peso.
  • Inflation decreased in 2Q17 for the fourth quarter in a row, falling by 3.08 p.p. with respect to the previous period, reaching a value of 23.28%. The BCRA has increased its reference monetary policy rate by 1.50 p.p. with respect to 1Q17, up to 26.25% in the second quarter of 2017.

For more information, click here to access the executive document in pdf (only avalaible in Spanish).

© GMS Management Solutions, S.L., 2018. All rights reserved. The information contained on this publication is of a general nature and does not constitute a professional opinion or an advisory service. The data used in this publication come from public sources. GMS Management Solutions, SL assumes no liability for the veracity or accuracy of such data.