Argentina's economic activity fell 1.9% year-on-year in November 2019

Economic activity in Argentina recorded a 1.9% drop last November compared to the same month of 2018, official sources reported Thursday.

The data was disclosed by the National Institute of Statistics and Census (Indec) when presenting the Monthly Estimator of the Economic Activity, an indicator that serves as a provisional advance to measure the variation of the GDP, of quarterly character.

According to official figures, the index that measures economic activity recorded a decrease of 1.7% in the eleventh month of the year compared to October and accumulated a 2.3% decline in the first 11 months of the year.

According to the official report, the activities that fell most in November in annual terms were fishing (-24.5%), manufacturing (-4.8%), wholesale and retail (-5%), construction (-6.9%) and financial intermediation (-8.5%).

On the contrary, the only sectors of economic relevance in Argentina that have shown improvements over the same month of 2018 were agriculture and livestock (+1.5%) and the exploitation of mines and quarries (+2.4%).

Economic activity in November was impacted by the negative effects in all sectors of the severe financial turmoil unleashed in mid-August, after the primary elections, in which the Peronist Alberto Fernández, winner of the presidential elections of September 27 October.

Financial shocks, particularly the sharp rise in the value of the US dollar, had a direct impact on inflation, which jumped 4.3% in November, and deepened Argentina's recession since 2018.

According to the latest official data available, Argentina's GDP accumulated a 2.5% drop in the first three first months of 2019 and added six consecutive quarters of decline until then.

For 2019, the Government of Mauricio Macri, which concluded its mandate last December 10, initially projected an economic contraction of 0.5%, although it subsequently corrected that forecast to a fall of 2.6%.

However, more adverse forecasts, such as those of private consultants that the Central Bank relies month by month for its expectations report, indicate that the Argentine economy had closed 2019 with a 2.8% drop.

The projections for 2020 are also negative, although more moderate: the International Monetary Fund predicts a contraction of 1.3%, while the local private consultants project a fall of 1.6%.