Manufacturing in Argentina fell 6.8% in October year on year, while construction declined 3.7%, and in the first ten months of this year 2.5% and 4.9% respectively according to the Indec statistics bureau report. Firms were hit hard by a contraction in economic activity and the devaluation of the Peso against the US dollar.
The number of incoming tourists to Argentina is increasing month after month since the drastic devaluation of the local currency, while outgoing tourism has dropped significantly. According to the latest release from the country's stats office, Indec, 224.000 tourists arrived in Argentina during August, 7.4% more than a year ago, while residents travelling overseas dropped 11.9%, to 335.300.
Almost two million Argentines are without a job, more precisely 1,999,387 according to the latest unemployment report from the county's stats office, Indec. In effect unemployment rose in the second quarter to 9.6%, from 8.7% a year ago, making it the highest figure in twelve years.
S&P said on Friday it may lower Argentina's long-term foreign currency rating from its current B+ grade, which is four notches below investment grade -- and on par with Turkey, Greece and Fiji. The ratings company cited the risk of worsening creditworthiness and exchange rate volatility as potential threats to the economic adjustment measures undertaken by Mauricio Macri’s administration.
The Argentine Peso plummeted 15.6% to a new record on Thursday, and ended trading at 39.87 after having reached almost 42 Pesos to the US dollar in mid afternoon. This follows on the Wednesday which also witnessed the Argentine currency slide 7% to the greenback.
Argentina’s central bank raised its benchmark interest rate by 300 basis points to 33.25% percent on Thursday, but the second steep rate increase in less than a week failed to stop the country’s peso currency from swooning to a record low. The local currency tumbled 7.83% to 23 per U.S. dollar. It had hit 21.2 to the greenback on Wednesday, the first trading day due to a holiday after the bank hiked the rate to 30.25% from 27.25% on Friday.
The US dollar in Argentina's foreign exchange market plunged on Friday 35 cents to 13.60 Pesos on the second day since President Mauricio Macri's administration decided to put an end to official restrictions for the purchase of greenbacks and other dealings with foreign currency.
Argentina announced on Wednesday it was lifting currency controls and would allow the peso to float when markets open on Thursday, setting the stage for a devaluation, following pledges by new president Mauricio Macri for reforms to spur economic growth.
Argentina's economy minister and central bank governor came out strongly to warn the “devaluation club” and speculators in the foreign exchange market who allegedly are pushing the value of the US dollar and sinking the local Peso.
Economist Aldo Ferrer has said the International Monetary Fund (IMF) was “incorrigible”, questioning the report the multilateral credit organism released this week saying Argentina should devalue on its peso currency and carry out austerity policies to get back on the track of growth.