UPDATE 2-Argentina economy slips into recession in 1st quarter

lunes 23 de junio de 2014 17:44 GYT

* First-quarter growth down 0.8 pct vs Q4 2013

* Slowing economy increases pressure for debt deal

* Exports, imports, consumption slow (Adds details on debt fight, GDP, analyst comments)

By Alexandra Ulmer

BUENOS AIRES, June 23 (Reuters) - Argentina's economy slid into recession in the first quarter, piling fresh pressure on President Cristina Fernandez's leftist government to reach a deal with holdout creditors to avoid a new debt default.

Hurt by declines in industrial output and consumer spending, gross domestic product in Latin America's No. 3 economy contracted 0.8 percent after shrinking a downwardly revised 0.5 percent in last quarter of 2013, official data showed on Monday.

The bad news comes as Argentina grapples with one of the world's highest inflation rates, falling central bank reserves and a string of setbacks in its legal fight with creditors who are insisting on full payment of debt that Argentina defaulted on in 2002.

Faced with a possible default on debt payments, Fernandez's government has in the past few days offered to negotiate with the holdouts.

Many economists expect Argentina to post a full-year contraction in 2014, the first since a 2001-02 crisis, when it defaulted on $100 billion of debt.   Continuación...