BUENOS AIRES: Argentina's economy grew 7.7 percent in September from a year earlier, beating market expectations and marking the 25th straight month of growth.
The EMAE economic activity index, published by the government on Friday, which measures most of the components of gross domestic product, inched up 0.3 percent in September from August.
It jumped 9.0 percent in the 12 months through September versus the same period a year before, the INDEC national statistics agency said.
Latin America's No. 3 economy is expanding at one of the region's fastest rates thanks to lucrative grains exports, robust consumer spending and industrial output led by car sales to the country's top trade partner, Brazil.
The government expects the boom to continue but at a more moderate pace. Next year's government budget bill forecasts 8.3 percent growth this year and a 5.1 percent expansion in 2012.
But some economists say in coming months, Argentina's galloping growth could be reined in even more sharply by capital flight, softer demand from Brazil, and a deteriorating global economy.
"There's a slowdown that is more evident in September and that will be seen in coming months and it is the result of capital flight," said Mario Sotuyo, an analyst for Economia & Regiones consulting firm.
"It has deepened in recent months and it is hitting economic growth head on," Sotuyo added.
September's pace of growth was estimated at 7.5 percent year-on-year, according to the median forecast in a Reuters poll.
In a data revision, INDEC said August's EMAE rose 0.7 percent versus July, compared with the 0.6 percent increase reported previously.
SLOWDOWN
Opposition politicians and private analysts say the country's prospects are too reliant on world grains prices and Brazil's economic outlook, and they are on the lookout for signs of a slowdown.
Economic growth could face further strain due to a series of new aggressive government measures to stem capital flight, which analysts say could backfire, encouraging more capital outflows by nervous investors and savers.
Increased state spending and high global commodities prices have helped encourage growth in Argentina, one of the world's top grains exporters.
Loose monetary policy is also buoying growth but at the cost of stoking inflation, which private economists estimate at roughly 25 percent, one of the region's fastest rates.
Independent analysts question government figures, saying the INDEC drastically downplays inflation and, to a lesser extent, exaggerates factory output and economic growth for political gain and to lower inflation-linked debt payments.
The government said this week it would cut more than $800 million in utility subsidies from homes and businesses to ease a growing burden on state finances.
"The slash to subsidies and less monetary emission by the central bank only serve to confirm that this slowdown will deepen," said Sotuyo. "Whatever happens, the Argentine economy is going to grow less. It's already slowing down this year and it will continue to do so in 2012."
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