Economic activity dropped 3.9% in June compared to the same month of 2023, the statistics bureau INDEC reported on Wednesday. The news put a stop to the slight optimism that had surfaced in May after the index showed a 2.3% growth following a six-month downslide.
The data was included in the latest Monthly Estimator of Economic Activity (EMAE, for its Spanish initials) report published by the INDEC.
According to the report, the accumulated drop in the first semester of 2024 is 3.2% compared to the same period of 2023. Compared to May of this year, activity in June went down 0.3%.
Nine sectors saw their inter-annual June activity plummet. The most affected were construction (-23.6%), industry (-20.4%) as well as the sector encompassing wholesale and retail commerce, as well as repairs (-18.6%). Those three sectors accounted for a 6.8 percentage point drop in the inter-annual EMAE variation, the report said.
Construction has been widely affected by the government’s decision to paralyze all public works as soon as President Javier Milei took office in December. While his administration eventually decided to continue some works that were near completition, the situation remains critical.
Only six economic sectors grew in June compared to the same month of 2023. The standouts were agriculture, livestock, hunting, and forestry (+82.4%), as well as mining and quarrying (+4,6%). They were also the sectors that had the most positive impact on the EMAE in June.
In June, monthly inflation reached 4.6%, the first increase after five decreases in a row, according to INDEC. In July — the latest data available — monthly inflation dropped to 4%, the lowest number in the Milei era. Although the president celebrated this as a victory, the economic situation remains critical, with prices rising 87% during the first seven months of the year and Argentines — as shown in the EMAE report — spending less due to the high prices.
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