Argentina Economic Activity Falls 2.9% in July, Largest Drop of 2026

Argentina's economic activity contracted 2.9% in July compared to June, marking the steepest monthly decline of 2026, according to the Monthly Economic Activity Estimator (EMAE) released by INDEC on Thursday. On a year-over-year basis, activity fell 1.4%, though the index accumulated 1.7% growth over the first seven months of the year.

The monthly drop was driven primarily by wholesale and retail trade, which fell 5.1% year-over-year, and manufacturing, down 4.6%. Together, these sectors subtracted 1.3 percentage points from the annual variation. Construction and financial intermediation also declined, by 3.3% and 3% respectively.

“If that pace were repeated for twelve months, the economy would shrink 29.8%, almost a third. It is not a projection, but a reference to illustrate the intensity of the fall.”

Conversely, fishing surged 424.5% year-over-year, while mining and quarrying rose 8.4%. Agriculture grew 0.7%. These three sectors contributed a combined one percentage point to the annual variation, partially offsetting the broader weakness.

Economy Minister Luis Caputo attributed the monthly contraction to temporary shocks, citing reduced gas availability affecting industry, heavy rains and snow impacting construction and mining, and fewer working hours during the football World Cup. He emphasized the 1.7% accumulated growth and noted the trend-cycle indicator rose 0.2% to a historic high.

Analysts at Fundación Libertad described the data as a signal of marginal weakness. Economist Facundo Beltramone noted seasonally adjusted manufacturing output fell 5% and construction 4.6% month-over-month. Diego Piccardo warned that if July's monthly pace annualized, the economy would shrink nearly 30%, though he stressed this was an illustrative reference, not a forecast.