Overview
- INDEC reported a 2.9% month‑on‑month fall in July's EMAE, the biggest single monthly drop since 2018 outside the pandemic and a move that turned the annual reading negative.
- President Javier Milei publicly questioned the EMAE's desestacionalized series, saying the adjustment methods misread an economy undergoing structural change.
- INDEC staff responded that a single monthly swing can be an outlier and that a formal recession requires two consecutive quarterly contractions plus a turning point in the trend‑cycle.
- Several banks and consultancies revised forecasts after the July reading, with JP Morgan flagging about a 4% annualized Q3 contraction and local firms warning of a substantial risk of a technical recession.
- The episode reopened concerns about INDEC's independence after February's director resignation and a postponed governance reform, and it leaves markets and households watching August and September data for confirmation or reversal.