Consumption improves in July but still struggles to recover

In July, consumer spending exhibited a 4.2% increase, yet year-over-year sales remain 2.6% below July 2025 figures, with a 2.9% decline for the year 2026. The Scentia consulting firm's monthly tracking survey revealed that only the pharmacy and e-commerce sectors experienced growth compared to 2025. Pharmacy sales surged 0.2% in the first seven months, while e-commerce surged 35.6% from January to June of last year, a 40% year-over-year increase.

The Milei administration attributes the retail sales decline to shifting consumer habits instead of reduced purchasing power. Mercado Libre founder Marcos Galperín, echoing the president's views, credits e-commerce for the growth. However, the Argentine Chamber of E-Commerce (CACE) cautions that e-commerce's contribution to total domestic demand is modest, accounting for about 8%.

Consumer confidence, as measured by the Consumer Confidence Index (CCI) from Di Tella University, declined 1.1% month-over-month in August, marking two consecutive drops after a 4.8% July decline, currently at 40.2 points—an April low. This sentiment mirrors the September 2025 level following Buenos Aires Province legislative elections where Milei faced defeat. Consumer perceptions of personal circumstances deteriorated 3.1% compared to the previous month, as did willingness to purchase durable goods and real estate.