Activity slows down: the consumption indicator fell by 1.7% in February

In February 2023, the Consumption Indicator (CI) of the Argentine Chamber of Commerce and Services (CAC) showed an increase of 0.8% in the year-on-year comparison, despite marking a decrease of 1.7% compared to the month of January in seasonally adjusted measurement, (that is, discounting the usual seasonal effects of consumption throughout the year).

This new indicator developed by the CAC reflects the monthly evolution of household consumption in final goods and services. “This poor year-over-year growth seen in February gives continuity to the inversion process exhibited by the IC since mid-2022 and its subsequent stagnation,” the entity said in a statement.

“This dynamic is consistent with a macroeconomy that is already under strain a purchasing power of Argentine families which has shown a new contraction in the second month of the year. In fact, the CI was more than 1% lower than the February pre-pandemic comparison.”

The clothing and footwear category presented in February an estimated 16.8% year-on-year decline, “discounting once again the loss of dynamism throughout 2022 which has progressively accentuated, accompanied by a relative increase in sector prices in a year-on-year comparison”. Consumption in this category was more than 20% lower than levels prior to the health outage.

On the other hand, the chapter on transport and vehicles demonstrates this an estimated growth of 3.2% in February. Even so, it’s still nearly 4% below pre-pandemic levels. “This takes place in the context of a process of deceleration and cooling of the sector that continues today, with car and motorcycle registrations growing by just 1.8% and 3.3% respectively on an annual basis“.

Leisure and culture still show significant growth rates (with an estimated 26.2% year-on-year increase in February), as a result of the sharp declines recorded following the pandemic and a slower reopening and recovery process than in other sectors.

As regards the housing, rental and public services sector, this showed an estimated progress of 4.8% in the second month of the year, ranking over 15% higher than pre-health outage levels.

As for the rest of the items, these recorded an estimated 2% year-on-year contraction in February, positioning themselves at levels more than 5% lower than the comparison with 2019.

AQ