WRAPUP 2-Argentina’s economic recovery strengthens in March

* Argentine economy grew 8.1 pct in March year on year

* Industrial production rose 10.2 pct in April yr/yr

* April trade surplus narrows to $1.9 billion

* First-quarter joblessness edges down to 8.3 percent
(Recasts, adds detail, analyst quote, byline)

By Kevin Gray

BUENOS AIRES, May 21 (BestGrowthStock) – Argentina’s economy grew
at its fastest pace in nearly two years in March, expanding a
sizzling 8.1 percent from a year earlier as brisk industry
activity strengthened a recovery, the government said.

There were other signs that Latin America’s No. 3 economy
is putting last year’s sharp slowdown behind it. Factory
production soared in April and the trade surplus narrowed as
demand for imported goods continued to pick up.

“The rebound is giving way to pure growth in the first
quarter,” said Enrique Dentice, an economist at the University
of San Martin.

Increasing auto production, rising consumer spending and a
rise in farm exports have helped lift Argentina’s economy.

The March economic growth sharply exceeded the 6.3 percent
median forecast in a Reuters poll and was the quickest since
July 2008.

The monthly economic activity indicator, known as EMAE and
which measures most components of gross domestic product, was
up 1.0 percent in March versus February.

Growing demand in Brazil is fueling automobile production
in Argentina, Latin America’s third-largest carmaker.

Argentine industrial production rose 10.2 percent in April
from the same month last year and was well above the median
forecast of 8.3 percent in a Reuters poll.

In other data also released on Friday, Argentina’s trade
surplus shrank by 15 percent in April from the same month a
year ago to $1.93 billion.

Official Argentine data has been widely questioned by
economists who say the government is underreporting inflation
and exaggerating growth and industrial production for political
reasons.

While analysts say the outlook this year for industrial
production, a key indicator of the economy, is positive, they
warn high inflation could boost wage demands and erode the
local currency’s competitive edge over trade partners.

Private economists forecast inflation at between 20 percent
and 30 percent by year’s end.

Government data also showed Argentina’s unemployment rate
dipped to 8.3 percent in the first quarter, down from 8.4
percent in the first three months of 2009.

The jobless rate also dipped from the fourth quarter, when
it stood at 8.4 percent.

The Argentine economy grew 0.9 percent in 2009, according
to the government, but many analysts say it contracted by 2
percent or more.

The government forecasts growth of 5 percent this year.

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WRAPUP 2-Argentina’s economic recovery strengthens in March