MercoPress. South Atlantic News Agency

Argentine economy expands at the lowest rate in six years

Argentina's economy grew 2.3 percent in January from a year earlier, the lowest monthly rate in more than six years as the global crisis hits home, according to the latest release from the government.

Argentina's January figures marked a 0.3% expansion from a month earlier, according to the government's monthly EMAE economic activity index. The official statement however did not give details on specific sectors, but some economic analysts said they expected a far worse result due to weaker consumer spending and declining factory output, particularly in the automobile industry.

According to a private growth estimate by the Orlando Ferreres & Asociados consulting firm, the economy shrank by 3% in January from the same month of 2008 -- marking its third consecutive contraction. Argentina's growth and industry statistics are coming under increasing scrutiny following two years of accusations of government meddling in inflation data.

”The official real activity numbers differ very significantly (more upbeat) from independent private sector estimates of the performance of the economy,” Alberto Ramos, senior economist at Goldman Sachs in New York, said in a report after January's data was released.

The local government reported last month that January's factory output sank 4.4% from a year earlier, the first fall since October 2002. Car production fell 54.6% during the first month of the year and vehicle exports sank 60%, according to industry data.

This week’s official release also indicated that the revised growth figure for December 2008 was 4.6% compared to the same month a year ago. The government has anticipated earlier that expansion had been 7.4%.