Industrial activity shrank by 11.5 percent in September when compared to the same month of the previous year – the sharpest drop since May 2009 – according to the latest report by the Indec statistics agency. Overall this year, the sector’s output shrank by 2.1 percent inter-annual. The construction sector, on its end, experienced a 4.2 percent drop this month and, even though the activity has increased by 6.4 percent in 2018 so far, the figure was 16.8 percent in June.
These staggering figure can largely be explained by the severe depreciation the peso went through during the last days of August and first days of November. In a span of days, the peso lost a third of its value, with the exchange rate jumping from AR $30 to AR $40 per US dollar.
Delving into the industry’s numbers, the report shows that the sectors affected the most were the textile (24.6 percent), automobile (15.7 percent) and oil refinery (11 percent). Surveyed by the agency, 60.7 percent of the companies expect for their activity in the domestic market to continue dropping during the fourth quarter of the year; 30.5 foresees a stable output and 8.8 an increase. Furthermore, 29.8 percent are likely to lay off staff, 5.9 percent are planning to hire and the rest does not expect to change its staff.