ARGENTINA – Smaller-than-expected sequential GDP contraction in 2Q21

We forecast 7% GDP growth for 2021.

Juan Carlos Barboza & Diego Ciongo

21/09/2021


Argentina’s GDP contracted on sequential basis in 2Q21, ending the streak of three consecutive gains. Output fell by 1.4% qoq/sa. GDP growth in 1Q21 was revised up, to 2.8% QoQ/sa. On a year-over-year basis, GDP increased by 17.9% in 2Q21, following a 2.9% gain in 1Q21, reflecting looser mobility restrictions than during the same period of last year. As a result, the statistical carryover for the rest of 2021 stands at 6.9%.



Domestic demand increased by 0.8% QoQ/sa in 2Q21, down from 3.0% in 1Q21. At the margin, private consumption rose by 1.1% QoQ/sa, while public consumption advanced by 0.5%. Fixed investment was flat in the quarter. Domestic demand (excluding inventories) rose by 27.1% yoy, led by a 76.6% yoy increase in gross fixed investment in the quarter, followed by an expansion of 21.9% yoy in private consumption and 8.2% yoy in public consumption. In terms of external demand, exports increased by 6.3% yoy, while imports rose by 36.6% yoy.



Looking ahead, we expect sequential gains for the remainder of 2021, mostly due to a significant easing of mobility restrictions. We forecast 7% GDP growth for 2021.

Juan Carlos Barboza
Diego Ciongo