imageEconomic Indicators3 hours ago (Aug 07, 2020 09:00PM ET)

BUENOS AIRES (Reuters) – Argentina’s economy is likely to contract 12.5% in 2020, a central bank survey of economists showed on Friday, a slightly more negative outlook than a month earlier as the impact of the coronavirus pandemic hammers the South American nation.

The economic outlook in the monthly report polling 44 economists was down from a 12% estimated drop previously.

Economists predicted a larger fiscal deficit of around 2 trillion Argentine pesos ($27.49 billion) as the government steps up spending to reignite the economy after two years of recession and to recover from COVID-19.

Those polled forecast a deeper contraction in the second quarter, but had a more positive outlook for the third quarter, “indicating that the period of greatest impact of the pandemic has already been overcome,” the report said.

Argentina has registered 235,677 confirmed infections of COVID-19, with daily cases accelerating in recent weeks as the country has looked to ease some lockdown restrictions in place in and around Buenos Aires, the capital.

The country, which defaulted in May, reached a deal with creditors this week to restructure $65 billion in foreign debt.

The central bank survey also estimated inflation for 2020 at 39.5%, slightly down from its month-earlier forecast. The peso currency was seen rising to 86.4 pesos per dollar in December 2020 and 123.2 pesos per dollar in December 2021.

Argentine economy to shrink 12.5% this year, central bank poll says

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.