WRAPUP 2-Argentina industry output jumps on Brazil demand

* 11 pct industrial output rise blows past market view

* Car exports to Brazil help keep production healthy

(Adds analyst quote, data, background, byline)

By Hugh Bronstein

BUENOS AIRES, March 19 (BestGrowthStock) – Argentine industrial
output raced past expectations in February powered by car and
steel plants feeding demand from neighboring Brazil, which is
recovering faster than expected from the global crisis.

Industrial output grew 11.0 percent during the month
compared with February 2009, Argentina’s national statistics
office said on Friday. The median forecast in a Reuters poll
was for a 6.7 percent increase in output year-on-year.

Argentine automotive production shot 140 percent higher in
February versus the same month last year while raw steel output
grew 53 percent, according to government data.

“I don’t think we will have such high figures in the
future,” said Bruno Fontana, an analyst at Buenos Aires-based
consultancy Datarisk Argentina. “Companies are forcing
production levels to the maximum, which will be hard to

Argentine gross domestic product expanded 2.6 percent in
the last three months of 2009 versus growth of 4.1 percent in
the same 2008 period, the National Statistics Institute, or
INDEC, said in a separate release on Friday.

Gross domestic product growth for the whole of 2009 was 0.9
percent compared with a 6.8 percent expansion in calendar 2008,
INDEC said. Private analysts — many of whom question
Argentina’s growth, employment and inflation statistics — say
the country’s economy contracted last year.

Argentina’s government expects the economy to grow 2.5
percent in 2010, according to its budget proposal. That
compares to official forecasts for 6 percent growth in Brazil,
Latin America’s largest economy and 3.9 percent in Mexico, the
region’s second largest economy.

Argentina’s growth and industrial output data releases were
accompanied on Friday by additional financial information from
the government.

The primary budget surplus narrowed to 1.21 billion pesos
($310 million) in February from 1.60 billion pesos reported in
February 2009.

Tax income growth has slowed as Argentina’s economy tries
to pull out of the doldrums of 2009 caused in part by the world
financial crisis.

The government faces about $15 billion in debt payments
this year as it seeks regulatory approval to reopen the
country’s 2005 debt restructuring. Argentina hopes to reenter
the international capital markets once it restructures $20
billion in paper left over from the country’s 2001/2002 debt

Argentina’s current account surplus widened to $1.58
billion in the fourth quarter of 2009 from $1.24 billion in the
same period a year earlier while the full-year current account
surplus rose to $11.29 billion last year from $7.09 billion in

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(Additional reporting by Karina Grazina, Juliana Castilla
and Walter Bianchi; Editing by Andrew Hay)

WRAPUP 2-Argentina industry output jumps on Brazil demand