feng2

Q growth data and ongoing government stimulus measures, we caution that headwinds are starting to gather. Links of London therefore forecast growth to slow to just . in and believe that the legacy bequeathed by President Cristina Fernández will take its toll on the country's economic trajectory over the medium term. Argentina joined the wide swathe of Latin American countries reporting very solid Q real GDP growth figures, with the economy expanding . yoy, according to official data. This marks the fastest expansion since the final months of the precrisis boom in Q, and suggests that ongoing stimulus Links of London Q Charm coupled with a strongerthanexpected rebound in gross fixed capital formation have pushed the Argentine economy into a more robust recovery cycle than we had initially anticipated. With leading indicator data suggesting that domestic demand remains in its upward trend for the time being, we are upgrading our real GDP growth forecast for to . from . previously. This forecast remains It Can't Last considerably below consensus Argentina GDP By Expenditure, chg yoy estimates, reflecting what we believe to be the unreliability of official economic data. We caution that consistent under reporting of Links of London P Charm and consequently overreporting of real growth rates continues to undermine the veracity of official GDP data, and we believe that the real economic picture in Argentina is likely to be considerably poorer than that suggested by official figures. Indeed, Argentina remains a stark Source BMI, INDEC example of one of our core regional views, namely that those countries with elevated political risk profiles, especially in the form of prolonged economic mismanagement, are set to underperform their more businessfriendly regional peers over the medium term. Signs Of Trouble Ahead While the Q headline figure is undoubtedly positive on first reading, we caution that there are already strong warning signs that the current rate of growth is unsustainable beyond parliamentary and presidential elections in Links of London o Charm Consumption On Shaky Ground While private consumption growth of . yoy in Q is undoubtedly an impressive outturn on the average . yoy growth seen in , we believe that much of this expansion was driven by consumers frontloading purchases in the face of rapidly rising inflation and negative real interest rates.