Industry and construction suffer sharp declines in July

Argentina’s manufacturing and construction sectors failed to recover in July, posting sharp monthly declines as both industries continued to struggle with the country’s changing economic model.

Manufacturing output fell 5% from June, while construction activity dropped 4.6%, according to data released by the National Institute of Statistics and Census, known as Indec. The figures marked another setback after the two sectors alternated between monthly increases and declines in recent months, a pattern economists describe as a “sawtooth.”

The sectors also remained below their year-earlier levels. Industrial activity fell 4.9% from July 2025, while construction activity declined 4.5%. Over the first seven months of the year, manufacturing accumulated a 2.6% contraction. Construction, by contrast, recorded a 1.7% increase compared with the same period in 2025.

The industrial data came after a public dispute last week between Economy Minister Luis Caputo and Guillermo Moretti, one of the vice presidents of the Argentine Industrial Union. Moretti had criticized the government and questioned officials’ understanding of the sector.

Caputo responded that industry had suffered its steepest decline during the final year and a half of the previous government, when it fell 14 points. He also argued that the sector had benefited from subsidies for costs, energy and the exchange rate, while consumers paid far more for goods than people in neighboring countries. “Even so, industry collapsed,” Caputo said at an event held by the Argentine Institute of Finance Executives.

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Even so, industry collapsed.