LATAM Today

Economics Research 18 September 2026 | 9:11AM EDT

LATAM Today: September 18, 2026

ARGENTINA Alberto Ramos | Goldman Sachs & Co. LLC Real GDP Contracted in the Second Quarter Driven by Weak Domestic Demand Bottom Line: The economy grew 2.0% in the second quarter, stronger than Sergio Armella | consensus expectations and the EMAE preview for a +1.6% yoy variation. Goldman Sachs & Co. LLC Sequentially, real GDP saw a 0.6% qoq sa contraction in the quarter, also above the Santiago Tellez EMAE preview which stood at -0.9% qoq sa. Growth in the first quarter was revised | up by 0.1pp to 2.4% yoy. Goldman Sachs & Co. LLC

Panteleymon Semka Overall, the economy performed poorly in the second quarter with growth driven | higher by exports and dragged by weak domestic demand. Activity in the primary Goldman Sachs & Co. LLC

sector continues to narrowly drive growth while the secondary sector and the more labor-intensive tertiary sector are lagging. The unemployment rate rose to 7.9%, the highest reading so far under President Milei. Following today’s data, which was mildly above our expectations and the EMAE preview, we raised our 2026 growth forecast by 0.1pp to 2.1%.

1. In the second quarter, real GDP rose by 2.0% yoy. On an annual basis, exports drove growth in the quarter with a 13.7% yoy expansion. Domestic demand contracted by 3.2% yoy, with final domestic demand down by 2.1% yoy, despite a 0.4% yoy expansion of private consumption. Gross fixed investment fell by a sizeable 11.1% yoy and public consumption declined by 4.1% year-on-year. Imports declined by 8.6% from a year ago. 2. From a supply-side perspective, the year-over-year increase in Q2 was driven by stronger primary sector activity. Fishing increased by 44.7% yoy (+0.1pp contribution), mining activity grew 16.4% yoy (+0.6pp contribution), and agriculture and livestock increased by 6.9% yoy (+0.8pp contribution). Financial intermediation (+4.8% yoy; +0.2pp contribution) and utilities (+5.0% yoy; +0.1pp contribution) also drove real GDP higher. Weaker activity in manufacturing (-2.1% yoy; -0.3pp contribution), public administration (-1.4% yoy; -0.1pp contribution), and commerce (0.0% yoy; +0.01pp contribution) moderated the extent of the expansion. 3. Sequentially, real GDP contracted by 0.6% qoq sa, reversing the positive momentum seen in the previous two quarters. The second quarter sequential decline was driven by domestic demand. Private consumption fell by 2.4% qoq sa and government consumption declined 2.3% qoq sa. Gross fixed capital

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formation contracted by another 0.8% qoq sa. All in all, domestic demand edged down by 1.7% qoq sa with final domestic demand down 0.6% qoq sa from the previous quarter. Exports rose by 2.5% qoq sa and imports declined by 3.5% qoq sa. 4. After the second quarter print, the statistical carryover for growth in 2026 stands at 1.3%. 5. The unemployment rate tracked at 7.9% in the second quarter of 2026, above 7.8% in the first quarter and higher than 7.6% one year ago. The labor force participation rate edged 0.3pp higher to 48.9% after remaining unchanged at 48.6% since the third quarter of 2025. The total employed population declined to 13.6 million in the second quarter, down 97,000 from the first quarter of 2026. The unemployed population, in turn, edged up to 1.2 million, 19,000 higher than in the last quarter.

Data Today: Trade Balance (Aug); we forecast a US$1.7bn trade surplus in August. Strong exports and softer imports have led to a notable strengthening of the trade balance so far in 2026. The cumulative trade balance over the last 12 months rose to a record US$23.7bn surplus in July, approximately 3.4% of GDP, up from US$11.3bn (about 1.6% of GDP) by year-end 2025. The cumulative energy balance over the last twelve months is tracking at US$10.6bn, as high oil prices due to the conflict in the Middle East have benefited Argentina’s energy exports.

Budget Balance (Aug); we expect the August budget balance to continue the government’s policy of…