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Recession: April data show sharp falls and the Government hopes it will be the floor before the rebound - Infobae
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Recesión: los datos de abril muestran fuertes caídas y el Gobierno espera que sea el piso antes del rebote
El Indec dará a conocer esta semana el EMAE de marzo. Algunas consultoras estiman que la economía cayó casi 10% en el último año. Cuáles son los sectores que muestran señales de recuperación y cuáles los que aún no lo hacen
www.infobae.com
May 21, 2024
The Indec will announce the EMAE for March this week. Some consulting firms estimate that the economy fell almost 10% in the last year. Which are the sectors that show signs of recovery and which are not yet doing so?
By Mariano Boettner
Picture of cars on an assembly line at a Toyota plant in Zárate, on the outskirts of Buenos Aires, Argentina, March 15, 2021. REUTERS/Agustin Marcarian
The second quarter of the year started with numbers in the red for a handful of key sectors of economic activity, while the Government still indicates that April should be the floor before the rebound begins, initially leveraged on the slowdown in inflation and the reactivation of credit.
For now, indicators of the real economy still reflect a scenario of persistent recession . Some advance data for April - prepared by private consulting firms - show the difficulty that the economy is going through in finding a starting spark . This week, Indec will release the Monthly Estimator of Economic Activity (EMAE) for March, which private calculations estimated, in interannual terms, with a collapse close to 10 percent , as noted by Orlando J. Ferreres.
With a closer approximation, private consultants collected the first consolidated information for April to analyze whether the activity floor occurred in March or the trend will be one of deterioration in the fourth month of the year. Analytica, on the one hand, took into consideration industrial activity measured through wholesale electrical energy consumption, which can be an approximate indicator of its production level.
“In April the interannual variation was -11.7% and -19.2% so far in May. Estimating a prediction model to explain industrial activity through sectoral energy demand, the drop in production during April would reach 18.4% and would deepen to 21.7% in May," anticipated the consulting firm directed by Ricardo Slim .
“The manufacturing industry reflects the economic recession very well. In March, the sector had a monthly drop of 6.3% and an interannual drop of 21.2% and reached its worst level, except for the pandemic, since 2017. The sector is extremely relevant within the productive and social structure. Taking into account registered employment data, between 2009 and 2023 it represented 19.7 percent. In turn, its informality rate was 43.3% in the fourth quarter of last year, below the economy's total of 45.3%. “Salaries in the sector are 12% higher than the average of the economy,” he stated.
Invecq, for its part, carried out a complete x-ray with all the sectors that have information available in April. “Some sectors began to show a recovery in year-on-year terms compared to the previous month, but they still remain in negative territory: cement shipments fell 42.9% in March compared to -35.6% in April in year-on-year terms; The Construya index went from having a year-on-year variation of -40% in March to -33.2% in April,” he listed.
“ Car registration : -35.3% in March vs -5.9% in April; motorcycle registration : -43.3% in March to -4.4% in April; Car production went from -29.4% in March to -21.0% in April and the CAME retail sales index : -12.6% in March vs -7.3% in April,” he indicated. There would be five sectors, thus, with negative numbers but less serious than in March.
On the contrary, he named three others that worsened: “ Agricultural currency settlements in March had achieved an increase of 22.2% year-on-year, while in the month of April this variation was negative of 21.6%; Some taxes directly related to activity also suffered a worsening in interannual and real terms, such as, for example, current account credits and debits went from -11.7% in March to -16.4% in April, as did employer contributions. with a variation from -15.9% in March to -17.0% in April and finally, cabotage passengers in the month of March had had an annual growth of 8% while in April this variation was negative at -1, 4%”, he concluded.
In conclusion, the consulting firm directed by Esteban Domecq pointed out that “the beginning of the second quarter comes with a moderation in the intensity of the fall in economic activity in a large part of these sectors, thus demonstrating that March could have marked a floor of the recession. . There are still sectors and indicators that show worsening in year-on-year terms, so there are still no signs that the much-announced 'V-shaped exit' will begin to occur."
The recession is beginning to be reflected in social indicators such as unemployment. EFE
What will be the photo that the Government will show this week? The EMAE for March is anticipated with the highest economic contraction numbers since the beginning of Javier Milei 's government . In December the interannual EMAE fell 4.5% , in January the decline was 4.3% and in February, 3.2 percent .
“Leading indicators for March show that the economy has not yet hit the bottom. Data from industrial and construction activity confirmed notable falls,” LCG said. “Added to this were several other sectoral indicators with red in the monthly variations. For this reason we expect a new contraction in March (greater than that of February). For April, some progress indicators do make it possible to think about stopping the fall ”, he considered.
The persistent effect of the recession will begin to be reflected, the market estimates, in labor indicators. “It is difficult to find precedents , due to its speed and depth,” said Vectorial about the collapse of economic activity. “Still far from turning the corner, what is beginning to be noticed is increasing expressions of the scope of the recession, which threatens to take away capacities and productive units that are then difficult to recompose and rebuild.”
“It is inevitable that this drop will not begin to have an impact on employment, beyond construction, which was the first to show a drop of almost 50,000 jobs,” he concluded. The Ministry of Labor showed, for now, since the end of November , the last “complete” data from the Fernández government until the end of February, 63,000 private salaried jobs were lost .
