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Economic activity fell 2% in May: they believe it has already reached a floor


It was the worst result of the year in monthly terms. But now they wait for the recovery to start.

Juan Manuel Barca

07/21/2021 18:38

  • Clarí

  • Economy

Updated 07/21/2021 7:01 PM

Activity fell 2% in May compared to the previous month and thus recorded the worst result so far this year

in the seasonally adjusted measurement.

The setback was due to the impact of the restrictions due to the increase in infections,

but for economists it could be the floor

of the recovery that the Government expects in the second half of the year ahead of the elections.

In the year-


year comparison

, the Monthly Economic Activity Estimator (EMAE) surveyed by INDEC showed

an increase of 13.6%

and accumulated a 9.5%


in the first five months of the year due to the low base of comparison with the worst moment of quarantine.

All in all, the May result was behind the 29.4% year-on-year growth in April

Following this measurement,

all the sectors recorded increases year-on-year, with the exception of agriculture

, which fell 4.3%.

Among the items with the highest incidence, industry rose 29.9% and commerce, 23.3%.

Between the two, they explained almost half of the year-on-year rise in activity, but in both cases the indicators were lower than those of April.

The fall in monthly terms coincides with the

decline registered by industry and construction



, with drops of 5% and 3% versus April.

The manufacturing sector showed signs of stagnation, as it used 61.5% of its installed capacity, a lower level than it had used in March and April.

"In the last week of May,

some economic sectors operated partially or were

inactive as a result of the restrictions linked to the health emergency, according to decree No. 334/2021. Global restrictions on the movement of people with the objective of to mitigate the COVID-19 pandemic affect a significant set of economic activities in all countries, "explained INDEC.

Some consulting firms expected a lower monthly drop in May than the one finally confirmed by the official body. With this result,

the economy added the fourth consecutive month in decline

and would accumulate a growth of just 0.3% in the year, explained by the increase of 2.1% per month in January, still standing 3.3% below the pre-pandemic level, according to LCG.

But now economists see a possible turnaround. "

The seasonally adjusted decline in May was relevant: with the 2% decline, activity returned to the values ​​of November

last year, while it is just over 0.5% below the close of last year.

Beyond these numbers, which are not positive, May could have been the floor

 and the second semester would bring better news, "said

Matías Rajnerman

, chief economist at



The government reported this week that the economy "resumed the path of recovery" in June from a 14.9% year-on-year growth in the industry. "

Unless there is a third wave, the worst would have happened because almost 50% of the population was vaccinated with the first dose, it is a flat and there would be a slow improvement but without pause,

" said

Lorenzo Sigaut Gravina

, director of



In this scenario, analysts consulted by the Central Bank expect

activity growth of 6.3% in 2021

, just below the 7% estimated by the Minister of Economy, Martín Guzmán. In this way,

 June would show signs of recovery

due to the impact of the

reopening of joint ventures

, the payment of the


to retirees

and the extraordinary bonus

to the beneficiaries of Power Work.

"We believe that May would be the bottom of this new restart of the decline in activity that began in February with a certain rebound in March as a result of the second wave," said Juan Pablo Di Iorio, economist at ACM.


Unlike the previous recovery, this one will be more generalized

because the lifting of restrictions would be accompanied by the vaccination campaign, which would give a lower level of uncertainty to the sectors of activity that lagged the most due to the pandemic," he said.

Look also

The Central Bank machine: the Treasury already needed an extra $ 460,000 million to finance spending

The blue dollar at $ 183: is there room for it to keep rising?

Source: clarin

All business articles on 2021-07-22

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