Thursday, August 22nd 2013 - 00:39 UTC

Argentina’s trade surplus down 40% in July; unemployment fell to 7.2%

Argentina's trade surplus shrank by 40% in July from a year earlier as surging fuel and auto imports increased pressure on President Cristina Fernandez government's system of currency controls. However the unemployment rate in the second quarter fell to 7.2% according to official data.

The US dollar in the parallel market again climbed to above 9 Pesos

Waiting for the US dollars to pour in...

July's trade surplus dropped to 770 million dollars from 1.277 billion dollars a year earlier, the government statistics institute Indec said on Wednesday. Imports rose 11% from a year earlier, boosted by shipments of buses from Brazil, trains from China and diesel oil from Russia and the United States. Exports edged up just 2% due to plunging oil and gas exports and stagnant agricultural output.

The trade surplus for the first seven months of the year shrank by 28% from the same period of 2012. That is bad news for the Argentine government, which relies on the surplus to boost dollar supplies on the tightly controlled currency market.

The government repays debts to private creditors using the central bank's foreign currency reserves. Argentina has been effectively shut out of global credit markets since its massive 2002 sovereign debt default.

Argentina's current account, the country's broadest measure of foreign transactions including trade, profit remittances, interest payments and other items, started the year with its deepest quarterly deficit since early 2001.

Meanwhile the Argentine currency weakened on the parallel market to 9.04 Pesos per dollar on Wednesday. The official exchange rate weakened 0.1 percent to 5.60 Pesos per dollar, part of a policy of gradual Peso depreciation that has diverged increasingly from the informal market and currently stands at 61.3%.

A good piece of news was unveiled on Tuesday was that Argentina's unemployment rate fell to 7.2% in the second quarter, according to Indec. The data confirms a decline in the jobless rate that Argentine President Cristina Fernandez had informally advanced in a speech a couple of weeks ago.

The unexpectedly sharp drop in the unemployment rate puts it down from 7.9% in the first quarter. Last week, Argentina's statistics agency said the economy gained traction in June and grew 6.4% from the same month year ago.

However a recent poll by Management & Fit showed that Argentines number three worry after inflation and crime is jobs, despite almost a decade of strong economic growth.

The new jobs data, which the Argentine president unveiled before an important primary election over a week ago, appeared to do little to boost her party's performance in the election. The president's Victory Front coalition lost a significant amount of support in the election compared with its performance in national elections two years ago.

The primary election was essentially a trial run for a midterm election in October, when Argentines will vote for seats in both the Lower House of Congress and the Senate
 

8 comments Feed

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1 golfcronie (#) Aug 22nd, 2013 - 04:20 am Report abuse
Looks like they have dropped a zero of the Peso note. Oh dear.
Toodle Pip
2 Optimus_Princeps (#) Aug 22nd, 2013 - 07:16 am Report abuse
Mercantilism failed at every turn of the wheel. It's really sad how the K's retried a concept that historically never worked and are calling it “progressive”.

How can the unemployment rate be any lower if a significant portion of the potential workforce are paid to remain unemployed?
3 LEPRecon (#) Aug 22nd, 2013 - 08:40 am Report abuse
Trade surplus down 40%, unemployment down to 7.2%, pigs flying, and Satan is skating to work!

Wow!
4 Simon68 (#) Aug 22nd, 2013 - 09:29 am Report abuse
2 Optimus_Princeps (#)
Aug 22nd, 2013 - 07:16 am

Optimus: Of course the unemployment figures are a lie as usual. What they really reflect is that people who had been put on the “white” have now gone back to being on the “black”!!!!!!!!!!

Just as an example 2.433 people lost their jobs in Puerto Madryn due to the closing down of fishing PyMES. The regional economies are in such a mess that I would guess unemployment is actually up to around 20%!!!!!!!!
5 Xect (#) Aug 22nd, 2013 - 10:03 am Report abuse
Are we to expect unemployment figures to get close to 5% when getting close to the election?

What next from the comedy club?
6 Conqueror (#) Aug 22nd, 2013 - 10:53 am Report abuse
@4 So, if the usual INDEC “statistical inaccuracies” are anything to go by, the trade surplus was actually down 70-80% and unemployment “fell” up to 15-20%. Getting the hang of this now. I'm surprised that the IMF don't “accept” INDEC's figures. After all, it's only necessary to halve any thing said to be getting better and double anything “admitted” to be worse. Surely it can't be long before they claim argieland to be the richest place on the planet. I can just imagine it. “In BA, everyone has a Cadillac.” A “Cadillac” being a plank of wood, two axles, four wheels, a crate, a length of string and a “Cadillac” badge stolen from someone else's vehicle.
7 ChrisR (#) Aug 22nd, 2013 - 11:44 am Report abuse
@6

That explains some of the crap you see with argie plates on Uruguayan roads.
8 Optimus_Princeps (#) Aug 22nd, 2013 - 03:05 pm Report abuse
@4 I'm fully aware that the statistics are as inaccurate as if they were invented by rolling a set of dice. The unemployment rate is at least double in some providences, maybe even triple in certain localities.

If there are any statistics I'm interested in, it's the crime statistics. Threats of physical violence do have an economic effect. It prompts people to hoard valuables in order to keep them from falling into the hands of a heavy handed government. There are historical accounts of this going back the feudal ages.
9 ljb (#) Aug 23rd, 2013 - 10:14 am Report abuse
@8

Surely you are not suggesting there is crime in Argentina. Everything is rosey and perfect don't you know. Low inflation, low unemployment, honest politicians and a well armed defence force. Perfect!

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