Argentina's industrial output is seen growing briskly in September, driven again by the steel, and automobile sectors, analysts said. Auto production ADEFA02 grew 37.8 percent in September from the same month last year and could reach record levels by year-end.
Analysts say, however, some sectors are showing signs of a slowdown.
"The chemical, agrochemical, paper and refinery sectors, as well as manufacturers of plastic, beverage and cigarettes produced less than (in September) last year," said Buenos Aires-based consultancy Orlando Ferreres and Associates.
Analysts say further investments are needed to maintain strong industrial output growth in the medium term because some sectors are working at maximum production capacity.
The figure will get a boost from the low base of comparison registered in September 2009, when industrial activity shrank 0.2 percent year-on-year amid the global economic crisis.
Industrial production rose 10.1 percent in August 2010. ARECI10
MARKET IMPACT: Investors will want to see whether industrial production growth slows slightly or if it remains a key driver to economic growth in Latin America's No. 3 economy. This would mean higher payouts on Argentina's GDP-linked warrants.
The government forecasts the economy will expand around 9 percent this year.
Longer-term prospects for local industry are clouded by high inflation. Analysts forecast annual inflation at over 25 percent this year. Such a result would fuel wage demands by trade unions, eating into the country's competitive edge over key trade partners such as Brazil.
Business leaders have also complained about the strength of the local peso currency ARSB=, which they say hurts Argentina's competitiveness, and could drive foreign companies to invest elsewhere.
LINKS: Argentina's bureau of statistics website: www.indec.gov.ar/
No comments:
Post a Comment