Argentina’s economy is projected to grow at a slightly slower pace in 2026 and 2027, with its economic performance closely tied to the country’s ability to reaccess international debt markets, according to a Reuters poll of economists. While inflation is expected to moderate from historic highs, it will remain in double-digit territory, reflecting persistent structural challenges.

GDP Growth Forecast

The median forecast for Argentina’s GDP growth is 3.0% for both 2026 and 2027, following a stronger 4.3% expansion in 2025, according to estimates from 25 economists surveyed between January 12-16.

• The most optimistic projection for 2026 is 5%, reflecting confidence in President Javier Milei’s reform initiatives.
• The lowest projection is 1.6%, driven by concerns over potential disruptions to the real economy.

Analysts note that Argentina’s growth will remain sector-specific, with resource-driven industries benefiting most under Milei’s economic model.

Inflation Outlook

Inflation, a long-standing issue in Argentina, is forecast to moderate to 25.3% in 2026, down from an average of 44.5% in 2025. This rate is higher than the 23.7% median forecast from an October poll, reflecting the persistence of sticky services inflation despite declining prices in other sectors.

• Inflation has fallen sharply from a peak of 237% in 2024, the year Milei began his presidency pledging to “chainsaw” government overspending.
• Analysts expect that intensified austerity measures and a potential return to international capital markets could support further declines in inflation.

Sectoral Performance

Milei’s economic reforms are shaping the performance of different sectors unevenly:

• Expected to perform well: Agriculture, mining, and the financial sector
• Expected to perform weaker: Commercial activity, tourism, manufacturing, and construction, although some improvement is anticipated compared to 2025

According to Marcos Cohen Arazi, economist at Fundacion Mediterranea’s IERAL institute:

“In 2026, agriculture, mining, and the financial sector are projected to perform well. Meanwhile commercial activity, tourism, manufacturing, and construction are expected to perform weaker, although with some improvement compared to 2025.”

The Importance of Debt Market Access

Argentina has been locked out of international debt markets since 2018, making reentry crucial for sustaining growth and stabilizing the peso currency. Access to foreign capital would allow the government to refinance maturing debt and reduce reliance on the International Monetary Fund (IMF).

Claudio Caprarulo, economist and director at Analytica, noted:

“The key is at least being able to place debt in international markets to cover principal payments due in the first half of the year. We project the government will be able to issue debt, although the volume and interest rate will depend on market conditions at the time.”

Officials hope the sovereign risk premium will decline enough to enable bond issuance under 10% interest, aligning with both local and foreign-law debt conditions.

IMF and Reserve Accumulation

The IMF recently welcomed the Argentine government’s efforts to rebuild foreign exchange reserves, signaling potential confidence in Milei’s reforms. Analysts stress, however, that sustainable debt issuance depends on robust reserve accumulation and a reduction of the current account deficit.

Sebastian Menescaldi, associate director at EcoGo, cautioned:

“The question is whether the supply of U.S. dollars from trade will be enough. If it is insufficient, there will be complications with the currency scheme.”

Outlook

Argentina’s economic trajectory in 2026 will largely depend on the success of President Milei’s reforms, stabilization of inflation, and the country’s ability to re-enter international capital markets. While growth prospects are stable, the economy faces significant structural and financial risks that will require careful management over the coming year.