Argentina's economy contracted 1.5% in April from March, underscoring uneven growth despite a rebound in some sectors. Agriculture led annual growth, while manufacturing and construction declined. Economists forecast growth for 2026 but note rising unemployment.
The continued economic contraction and uneven recovery in Argentina highlight significant challenges for President Javier Milei's administration. Rising unemployment alongside sectoral growth indicates a fragile economic situation that could impact social stability and investor confidence.
Argentina's economy experienced a contraction in April, falling 1.5% from the previous month, according to government data. This downturn follows a brief rebound in March and highlights a persistent trend of uneven growth within the nation's economy. On an annual basis, economic activity saw a 1.6% increase.
The composition of this growth remains a key concern, with strength concentrated in competitive, tradable sectors while broader economic indicators show little improvement. Agriculture led the growth on an annual basis, contrasting with declines in manufacturing, retail, and fishing. Earlier data also indicated that while mining expanded, both manufacturing and construction contracted by more than two percent year-over-year.
Despite these challenges, Argentina's gross domestic product saw a better-than-expected 0.7% expansion in the first quarter compared to the prior quarter, largely driven by consumer spending. Looking ahead, forecasts suggest GDP could expand for a second consecutive year in 2026, fueled by anticipated record exports in energy, agriculture, and mining. However, this projected growth is occurring alongside a rising unemployment rate, with the formal labor force losing nearly half a million jobs.