Argentine economic activity grew at a steady pace in October but there are signs that growth will cool in the coming months, local consultants Orlando J. Ferreres & Asociados, OJF, said Thursday.
OJF’ October economic-activity index was up 5.9% from a year earlier, slightly higher than the average 5.5% growth seen over the past six months. Growth between January and October was up 6% on the year.
In October, the financial sector saw the strongest expansion, rising 26% on the month, followed by construction, 6% and retailing, 6%, OJF said. Mining, agriculture and livestock on the other hand contracted 3.5% and 0.4%.
Despite the strong expansion, the pace of growth is seen slowing. A drop in Brazilian manufacturing and a rise in local interest rates are expected to drag on growth prospects, OJF said. Brazil is Argentina’s top trade partner.
However taking into account the current international and domestic contexts, a greater declaration in growth could have been expected” said the report.
The Central Bank of Argentina has forecast a 9% expansion in the GDP this year due to hefty fiscal and monetary stimulus, a consumer-spending spree, and strong demand for exports such as cars and grains.
However, the central bank and the government expect activity to cool next year, with the Economy Ministry forecasting 5.1% growth in its 2012 budget bill.
Source: MercoPress