BUENOS AIRES (Reuters) - Argentina’s economic activity likely plunged by over one-fifth in April, according to a Reuters poll of analysts, underscoring the economic impact from a nationwide lockdown imposed in mid-March to stem the spread of the novel coronavirus.
The South American grains producer is headed for an annual economic contraction estimated at around 10% because of the pandemic, deepening an already two-year recession and hammering families, industry and government income.
“Economic activity hit rock bottom in April. Construction, manufacturing and commerce showed the biggest collapses, but no sector managed to escape the overall crisis,” said consultancy Orlando Ferreres & Asociados.
The five local and overseas analysts polled by Reuters predicted an average drop of 20.8% for the month, with a median contraction of 21%. Estimates ranged from a minimum monthly fall of 18.8% to a maximum drop of 23%.
“For the next few months, the main concern lies in the closure of companies and the possible permanent reduction of the ‘capital stock’ that it will entail,” Argentine consultancy Ecolatina said in a written response to Reuters.
“Likewise, even when the quarantine passes, there will be greater precautionary savings due to the fears it will have caused ... Consequently, the crisis and the collapse of economic activity will extend beyond the lockdown.”
Argentina’s government is expected to extend a lockdown in and around capital city Buenos Aires beyond the end of June, and to tighten rules about movement after a recent spike in cases.
Argentina’s official INDEC statistics agency is set to release the official economic activity data on Monday.
Reporting by Hernan Nessi; Writing by Adam Jourdan; editing by Grant McCool