UPDATE 1-Argentine economic activity unexpectedly drops in March

viernes 16 de mayo de 2014 15:40 GYT
 

(Adds background on economic slowdown)

BUENOS AIRES May 16 (Reuters) - Argentina's economic activity index unexpectedly slid in March by 0.9 percent on the year, data from the INDEC statistics agency showed on Friday, adding to signs of a slowdown in Latin America's third-largest economy.

The median forecast in a Reuters poll of economists had been for growth of 0.4 percent after rises of 1.3 percent in the two previous months. The monthly EMAE economic activity index is a close proxy for gross domestic product.

Sluggish private consumption in the face of rampant inflation, higher interest rates and a reduction in energy subsidies are stunting economic momentum, economists say.

Lower demand at home and in Brazil is in turn contributing to a crisis in the key auto sector, where thousands of factory workers are facing shorter working hours. Car production slid 21.6 percent in April on the year, data showed last week. (Reporting by Alejandro Lifschitz; Writing by Sarah Marsh; editing by Matthew Lewis)