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Published on Tuesday, March 25, 2025 | Updated on Tuesday, April 1, 2025

Argentina Economic Outlook. March 2025

Summary

In 2025, GDP is expected to grow by 5.5%, driven by consumption and investment, within a context of disinflationary consolidation and fiscal-monetary discipline. However, two key challenges remain: maintaining fiscal austerity during an election year and making significant progress in normalizing the foreign exchange market

Key points

  • Key points:
  • Popular support for Milei's administration remains high, making him the President with the highest approval rating 15 months into his term since Néstor Kirchner.
  • The economic rebound that began in the second half of 2024 has extended into early 2025, reinforcing our growth forecast of 5,5% in 2025, underpinned by a recovery in consumption and rising investment, though with significant sectoral heterogeneity.
  • We expect the crawling peg to continue until October (with minor changes after the agreement with the IMF), contributing to mitigate the usual pre-election volatility. After the midterms, a gradual dismantling of capital controls is likely to be introduced, involving a correction in the official FX rate (projected at ARS/USD 1,400 by December 2025).
  • The combination of tight monetary policy and a managed exchange rate has driven a slowdown in inflation, which is expected to end 2025 at 30%. However, the recovery in economic activity and real wages, along with pending adjustments in regulated prices, will place limits on the speed of disinflation.

Geographies

Documents and files

Podcast (MP3)

Argentina 2025: inflation, consumption and fiscal balance

Spanish - April 1, 2025

Presentation (PDF)

Argentina Economic Outlook. March 2025

English - March 25, 2025

Presentation (PDF)

Argentina Economic Outlook. March 2025

Spanish - March 25, 2025

Authors

MD
Marcos Dal Bianco BBVA Research - Chief Economist
FD
Federico Daniel Forte BBVA Research - Principal Economist
JM
Juan Manuel Manías BBVA Research - Principal Economist
AH
Adriana Haring BBVA Research - Senior Economist
MI
Mario Iparraguirre BBVA Research - Senior Economist
TT
Tomas Triantafilo BBVA Research - Economist
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