Argentina Grows Faster Than Expected, Ending 18-Month Recession
Argentina Grows Faster Than Expected, Ending 18-Month Recession
(Bloomberg) -- Argentina’s economy grew faster than expected in the third quarter, technically ending an 18-month recession.
South America’s second-largest economy grew 0.9% from the April-June period, its first quarterly expansion since 2017, and faster than the 0.6% forecast by economists surveyed by Bloomberg.
Yet the country is poised to slip right back into recession, according to a central bank survey of economists who forecast quarterly contractions in the end of the year as well as in the beginning of 2020. A recession is defined as two consecutive quarters of contraction.
ARGENTINA REACT: Out of Recession, But Not Out of Crisis
The economy shrank 1.7% from a year earlier in the third quarter. It is also forecast to contract in 2020, for a third straight year.
President Alberto Fernandez, who took office Dec. 10., rolled out a series of so-called emergency measures Tuesday to increase social spending in hopes of kick starting the economy next year.
Argentina fell into recession in mid-2018 amid zigzagging economic policies, global market selloffs and a historic drought that ruined valuable crop exports. The peso has plunged nearly 70% since the start of last year, which fueled inflation now above 50% and triggered double-digit unemployment.
Amid the severe downturn, the previous government led by Mauricio Macri sought a $56 billion credit line from the International Monetary Fund that Fernandez now has to renegotiate. The IMF lifeline has been on hold until Fernandez spells out his economic policies.
To contact the reporter on this story: Patrick Gillespie in Buenos Aires at pgillespie29@bloomberg.net
To contact the editors responsible for this story: Juan Pablo Spinetto at jspinetto@bloomberg.net, Matthew Bristow, Walter Brandimarte
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