In Argentina, by contrast, the economic situation deteriorated last summer; the appreciation of the dollar, to which the peso is rigidly pegged, resulted in a further loss of competitiveness in 2000, of about 5 per cent. In Europe the growth in exports, investment and sales of consumer durables had brought a sharp acceleration in production and job creation in the middle of 1999.
The expansion, which was still strong in the first half of 2000, weakened over the summer. The upturn in inflation diminished households' disposable income. The repercussions of the rise in the price of oil were more severe in Italy than elsewhere.