Argentine industrial sector records decline in July

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Industrial activity in Argentina fell by 0.4% in July according to research firm Orlando Ferreres & Asociados, contributing to a 2% decline for the first seven months of the year compared to 2023. Data from the Argentine Industrial Union (UIA) similarly recorded a 0.6% monthly drop, noting that manufacturing performance reached levels 10% lower than those observed during the 2022 and 2023 periods. The automotive sector experienced the sharpest monthly decline at 6.8%, while exports to Brazil, Argentina’s largest trading partner, fell by 12%. Reports from the Center for Political Economy (CEPA) indicated that approximately 1,700 industrial companies closed since President Javier Milei took office, resulting in 39,000 job losses within the sector.

Consequences

The industrial sector is expected to remain defined by a split between foreign-oriented markets and domestic-facing sectors weakened by low demand. Recovery in the lagging sectors remains contingent on an increase in household income and retail consumption, neither of which has yet materialized as private sector registered wages remained 3.6% below November 2023 levels as of June.

Sources

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