Argentina GDP contracts 0.6% in Q2, first quarterly drop in two years; 2026 growth forecast cut to 3%

Argentina's economy shrank 0.6% in Q2 2026, its first quarterly contraction in two years, prompting the government to slash its 2026 growth forecast to 3%. The data signals a stalling of the Milei administration's stabilization program, raising doubts about the sustainability of its reform agenda. The contraction is a setback for investor confidence and could pressure the government to adjust policy ahead of midterm elections.