Argentina's economy grew by an annual 2.4pc in August, the slowest pace in nine months, ahead of a key vote on 26 October to elect half of the country's congress.
Growth slowed from an upwardly revised 3.1pc annual rate in July and down from 6.2pc in June, statistics institute Indec reported Wednesday. The economy has expanded each month since October 2024. The economy contracted by 3pc in August last year.
President Javier Milei's government is hoping for 5pc growth for the year, while the International Monetary Fund forecast the economy to expand by 4.5pc this year, slightly lower than its initial 5pc estimate.
The growth figures come on the back of inflation numbers that are falling, but slower than expected.
Inflation was an annualized 31.8pc in September, down from 33.6pc in August. But it was down from 209pc in September last year.
All Argentinian data is being analyzed through the lens of recently agreed US assistance, which will eventually total $40bn in different currency swaps and a private facility, and the upcoming mid-term congressional elections linked to it.
The Argentinian Central Bank said on 20 October that it officially signed a $20bn currency swap line with the US Treasury to prop up the peso. The US Treasury-backed private facility is still in the works.
The swap, however, has yet to help, with the peso declining 1.9pc against the dollar on 22 October alone. The peso has depreciated for most of October.
US president Donald Trump and treasury secretary Scott Bessent have tied the economic lifeline to the midterm elections, when Argentinians will elect half of the 257-member lower house and 72-member senate.
The Milei administration has been trying to lower expectations. The administration wants to avoid a repeat of a 7 September local election in the capital province, Buenos Aires, when it lost by 14 points.
Argentina, the third largest economy in Latin America, is a major grain and beef producer, and increasingly turning to oil/gas and mining for future development. The country sits on the Vaca Muerta unconventional formation with 16bn bl of crude and 308 trillion cf of natural gas reserves, according to the US International Energy Administration.
It is fourth in lithium reserves, with 4mn tonnes (t) and tied for first in lithium resources, with 23mn t, according to the US Geological Society.
By Lucien Chauvin
