Private economists and the Central Bank's own market survey have cut their 2026 growth forecasts for Argentina toward roughly 2%, down from above 3.5% projected at the start of the year, as seasonally adjusted economic activity has been essentially flat since December -- leaving the government's budgeted 5% growth target as an outlier even among its own allies in the financial sector.
Latin Securities Argentina revised its call to 2-2.5%, from 3-3.5% in January. Eco Go cut its estimate to 2.0% from 2.7%. Analytica put its projection "slightly below 2%." The REM, the Central Bank's survey of market economists, put the median forecast at 2.7% as of July, down eight tenths of a point from December's 3.5% consensus. The IMF has held its own forecast at 3.5%, unchanged and now the most optimistic outside estimate on the board.
The revisions follow weaker hard data. Argentine output likely contracted 0.4% in the second quarter, according to private estimates -- a full percentage point worse than earlier surveys had suggested -- while activity expanded just 1.9% in the year through June, down sharply from 6.1% growth over the same span a year earlier. Bárbara Guerezta of Latin Securities Argentina said the economy "hasn't grown in seasonally adjusted terms" from December 2025 through August 2026. Central Bank president Santiago Bausili has acknowledged the economy is growing "around 2% annually, much slower than desired."
Analysts cite several causes for the slowdown: a restrictive monetary policy under which the government has stayed out of international debt markets, limiting liquidity; a rise in loan defaults that has kept credit from driving growth as officials had hoped; eroded purchasing power weighing on consumer demand; and a post-election recovery that has arrived more slowly than expected. The slowdown is also uneven across sectors -- mining, energy and agriculture continue to drive what growth there is, while manufacturing, construction and commerce have weakened, with small businesses reporting persistent strain; one plastics manufacturer cited in reporting on the slowdown said it was running at under two-thirds capacity.
The growth picture complicates the government's economic narrative heading toward the 2027 presidential race. Inflation has fallen sharply on Milei's watch, from triple-digit annual rates to roughly 34%, but that disinflation has not been matched by the acceleration in activity officials had promised, and Milei's approval rating stood at 37.1% in an AtlasIntel poll taken in July -- near the lowest point of his presidency.