Argentina

Current Economic Outlook

RGE has revised upward its GDP growth expectations for Argentina to 2.6% y/y from 2.2% y/y for 2010, reflecting a slight upgrade in our assessment of global and regional, in particularly Brazilian, economic performance. Moreover, RGE projects that a low base effect, coupled with improving domestic confidence and a strong recovery in the agricultural sector will lead growth next year. Needless to say, net exports will have a negative impact on growth as imports bounce back faster than exports, while grain prices will remain temperate in 2010. At the aggregate level, RGE anticipates private consumption and investment to increase 2.1% y/y and 7.4% y/y in 2010. Overall, RGE sees a sluggish recovery as economic activity will fall short of the boom period (2003 to 2008) when the economy expanded 8.5% y/y on average. felt more powerfully in 2010. For 2009, RGE maintains the view that Argentina’s GDP will likely contract 2.5% y/y driven by declines in private consumption (‐3% y/y) and investment (‐16.1% y/y). Difficult external conditions and fragile domestic demand, together with…

Read the latest RGE Global Economic Update.