Friday, January 21

Activity: they estimate that in October it grew below 1% per month


Analysis

As explained by the economist of Equilibra Lorenzo Sigaut Gravina to Ámbito, the activity will recover this year around 10%. “I don’t know if it will reach 10%, basically because in the fourth quarter of this year, the outlook fell. In September we reached, I think, the peak of activity this year. But the reserves began to fall sharply, and in the first days of October the Central Bank had to make an iron grip on the imports of goods. And the problem is that, just as the restrictions on mobility affect many non-tradable sectors, the restrictions on imports and the significant closure that was the limit of advance payment of imports, although it helped to reduce the reduction in reserves in October and November, affect sectors that are closely linked to imports. The most specific case is the industry: in fact, there is industry data for October and it was a significant drop (-5.7% seasonally adjusted), which is one of the sectors that most depends, along with trade, on imports of goods. So I see a more stagnant fourth quarter, in seasonally adjusted terms. Likewise, there are sectors that will not be affected by import restrictions, so it could have a mixed behavior ”.

Projections

For its part, according to the General Activity Index prepared by the consulting firm Orlando Ferreres, in October there was a growth of 0.7% per month and 6.4% year-on-year. “In the tenth month of the year, industry and commerce showed some slowdown in their annual figures, but a good boost was observed from the agricultural sector, thanks to the good start of the wheat harvest, which is estimated to reach show a record in their yields, and the expansion of the mining and quarrying sector, driven by the development coming from Vaca Muerta ”, they remarked from the firm in their monthly report.

“Going forward, the health situation does not threaten for now to condition the progress of the activity, and during the coming months, particularly with the arrival of the summer season, the service sector has ample room to grow and drive activity” added the Ferreres study, which concluded: “In any case, the macroeconomic outlook is in a highly fragile situation and short-term patches such as maximum prices, import restrictions or the same exchange rate are obstacles to economic advancement and they do not help to solve the underlying problems ”.

Meanwhile, from the Institute of Labor and Economy (ITE) of the Germán Abdala Foundation, they estimated a growth of activity in monthly terms of 0.4% compared to September, “marking an incipient trend of growth after the decrease in recent months around the levels reached in the months prior to ASPO 2020 ”. In the year-on-year comparison, the ITE estimated an increase of 9.2% in the economy, to accumulate an improvement of 10.6% in the first ten months of the year.

Finally, from the ACM firm, they estimate a “considerable” recovery in activity, around 8.6%.



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