Algo está fallando en la economía de ARGENTINA ¿Qué está pasando con MILEI?

In September 2026, Argentina released economic data that forced JP Morgan to revise its forecasts significantly. The monthly activity indicator (INDEC) showed a 2.9% decline in July, nearly three times worse than the projected 1% drop. While temporary factors like an extended holiday weekend and weather issues contributed, JP Morgan noted underlying weakness predated these circumstances. The year-on-year comparison showed a 1.4% contraction, though year-to-date growth remained positive at 1.7% through July.

The economic weakness reveals a divided economy. Trade fell 5.1% and manufacturing declined 4.6% year-on-year, explaining almost the entire overall decline. Conversely, mining and extractive activities grew 8.4%. This sectoral divide is problematic because mining and oil extraction have limited multiplier effects on the domestic economy—when farms import machinery, most investment dollars leave the country rather than circulating locally.

Inflation slowed to 1.7% monthly in August from 2.1% in July, which is positive, but year-over-year inflation remains at 33.5%. Crucially, lower inflation rates don't mean prices fall, only that they rise more slowly. This creates a purchasing power problem: families' income hasn't grown proportionally to past price increases, widening the gap between expenses and earnings. This dynamic is visible in poverty rates, which rose from 31.6% in the first half of 2025 to 32.3% in the first half of 2026.

The consumption crisis stems from multiple reinforcing factors. As families exhaust savings and face rising basic necessity costs with stagnant wages, they cut discretionary spending. Banks, facing rising defaults, tighten lending standards, making credit expensive and difficult to obtain. This credit contraction spreads through the economy: fewer consumer orders mean factories reduce production and worker hours; employees earn less and spend less; companies postpone investment in new equipment; and tax revenue to the government declines.

The government faces structural constraints. Maintaining its zero-deficit policy requires cutting spending when revenues fall, creating a vicious cycle where austerity measures become self-defeating. Additionally, the opening of the economy exposes Argentine producers to imported competition, further pressuring local companies and tax collection.

JP Morgan forecasts 1.5% growth for 2026 and projects a potential contraction in the third quarter (approximately 1% quarter-over-quarter). For 2027, the bank expects 2.5% growth driven by exports increasing 11%, but private consumption growing only 0.4%—exemplifying the core problem: Argentina can grow statistically without this growth reaching most families' pockets.

The government's strategy centers on attracting private investment through the RIGI (incentive regime for large investments), offering 30-year tax and customs stability to major projects in energy, mining, infrastructure, and technology. Key projects include Vaca Muerta shale development and lithium mining in the Lithium Triangle. If built as planned, these could generate construction, supplier, and employment chains spreading benefits beyond export sectors. Labor reforms approved in February 2026 aim to reduce formalization barriers and hiring costs. The long-term bet is that macroeconomic stability, reduced bureaucracy, and predictable rules will attract the large capital investments needed.

The critical question is whether Argentine families will have patience for these multi-year projects to yield employment and income before the next elections, and whether the government can successfully execute its plan while maintaining stability.