UPDATE 1-Argentina says economy grows 2.3 pct in second quarter

viernes 18 de septiembre de 2015 16:02 GYT
 

(Adds data breakdown, background)

BUENOS AIRES, Sept 18 (Reuters) - Argentina said on Friday Latin America's third-largest economy expanded 2.3 percent in the second quarter compared with the same period in 2014, as government consumption surged.

The data could bolster the ruling party's bid to hold onto power in presidential elections next month. President Cristina Fernandez is barred by the constitution from a third consecutive term but has endorsed the candidacy of the Front for Victory's Daniel Scioli.

A 10.3 percent rise in public consumption supported growth, the economy ministry data showed. The outgoing administration has championed the use of countercyclical measures and increased spending to boost growth at a time of weakness in the regional and global economy.

On a quarter-on-quarter basis, gross domestic product in grew 0.5 percent in the three months to June, economy ministry data showed.

A web of trade and currency controls, falling grains prices, and a marked slowdown in regional economies have hampered Argentine growth in past years. It has one of the highest inflation rates in the world, at between 25 and 30 percent according to private economists.

However, both public and private consumption have picked up this year and in the presentation of the 2016 budget bill, the economy ministry this week forecast economic growth of 2.3 percent this year and 3.0 percent next year.

The data released on Friday showed private consumption grew 0.7 percent in the second quarter from the year-ago period.

Domestic demand helped compensate for a drop in external demand. Imports rose 2.8 percent while exports fell 0.2 percent.

The economy had grown 2.1 percent in the first quarter versus the year-ago period.

The ruling party's Scioli is leading in polls ahead of the Oct. 25 elections. His main rival is opposition candidate Mauricio Macri, outgoing mayor of Buenos Aires and leader of the business friendly PRO party. (Reporting by Buenos Aires newsroom; Writing by Sarah Marsh; Editing by Meredith Mazzilli)