UPDATE 1-Argentine economy swells 12.4 percent in May

* Year-on-year figure highest since March 2004

* Expansion outpaced market expectations

* Pace fueled by consumer demand, sales of cars to Brazil
(Adds background, analyst)

BUENOS AIRES, July 16 (BestGrowthStock) – Argentina’s economy
expanded by a sizzling 12.4 percent in May from the same month
a year ago, the government said on Friday, marking the fastest
growth pace in more than six years.

Latin America’s No. 3 economy is rebounding from a sharp
slowdown in 2009, boosted by increased consumer spending and
factory output, particularly in an auto industry fueled by
strong demand for Argentine-made cars from neighboring Brazil.

A Reuters poll of nine analysts had given a median outlook
for a 9.8 percent increase in the EMAE economic activity index
(AREAI=ECI: ) in May, with estimates ranging from 6.5 percent to
10.6 percent.

The economy grew 1.7 percent in May from April, the INDEC
national statistics agency reported.

Economic analysts say the government is stoking growth with
high public spending and loose monetary policy.

“There has been an effort to make the economy grow. There
has been a very aggressive public spending policy,” said
economist Miguel Kiguel from the consulting firm Econviews.

Argentina’s economy expanded just 0.9 percent in 2009,
according to official data, but many analysts say it probably
contracted by 2 percent or more.

Official economic data in Argentina has been widely
questioned for more than two years, with many private
economists accusing the government of overstating growth and
underreporting inflation for political purposes.

The government expects the economy to expand by at least 5
percent this year.
(Reporting by Helen Popper and Luis Andres Henao; Editing by
Eric Walsh)

UPDATE 1-Argentine economy swells 12.4 percent in May