GDP grew 0.7% qoq/sa in 1Q26, moderating from 1.2% in 4Q25 but coming in above the 0.4% qoq/sa implied by the monthly activity proxy (EMAE). On an annual basis, GDP rose 2.3% YoY, down from 3.3% YoY in 4Q25. The statistical carryover for 2026 stands at 1.8%.

Domestic demand remains flat. Final domestic demand—primarily driven by private consumption and investment—was unchanged st the margin (0.0% qoq/sa), down slightly from +0.1% in the previous quarter. Within components, private consumption increased 0.8% qoq/sa, while gross fixed investment contracted 1.7% qoq/sa. Public consumption also declined by 2.4% qoq/sa in the quarter.

Investment contracted by double digits on an annual basis. Domestic demand (excluding inventories) fell 0.2% YoY, reflecting a sharp contraction in gross fixed investment (-11.6% YoY) and a decline in public consumption (-0.9% YoY). In contrast, private consumption provided support, expanding 2.7% YoY. On the external front, exports increased 9.8% YoY, while imports contracted 7.5% YoY.

Our take: We forecast GDP growth of 3.5% in 2026, led by primary sectors, particularly agriculture, energy, and mining. The ongoing disinflation process and lower interest rates should underpin a recovery in real incomes and, consequently, private consumption. Private investment is projected to eventually turn the corner, although annual contractions in imports of capital goods suggest the trough has yet to be met.