Argentine Economy Still Shrinking

The LatAm Economic Research Foundation (FIEL) expects Argentina’s GDP to contract by 5.3% in 2009, says chief economist Daniel Artana during a panel at the Americas Society. This forecast is gloomier than that of other shops. Credit Suisse recently chopped its forecast for growth in Argentina to a 2.5% contraction in GDP from 1.5% previously. Morgan Stanley sees GDP shrinking by 4.7% in 2009. Bulltick and BCP meanwhile believes GDP will stay flat in 2009. FIEL also forecasts the ARP will end the year at ARP4.30 per USD. Bulltick Capital expects the currency to end the year between ARP3.80-ARP3.90 per USD and Morgan Stanley sees it at ARP4.80 per USD. Despite a bearish view on growth, Credit Suisse still recommends Argentine debt. “We still believe Argentine assets are cheap and that this “high-beta” sovereign is set to outperform in coming months,” says the shop.