Mexico GDP Q1 2016


GDP shows solid expansion in Q1 due to broad-base gains

Mexico’s GDP gained momentum in the first quarter, according to a preliminary estimate released by the National Statistics Institute (INEGI) on 29 April. INEGI introduced a preliminary estimation of quarterly GDP, in line with numerous other major OECD countries that release more timely preliminary estimates. Revised data will continue to be published within the same time frames as before, but will be subject to revisions compared to the preliminary results.

The flash estimate showed that the economy increased 2.7% in Q1 over the same period last year, which represented a mild acceleration over the 2.5% expansion observed in Q4 2015. Sequential data adjusted for seasonal patterns showed that GDP grew 0.8% in Q1, which was up from the 0.5% rise tallied in Q4.

According to INEGI, faster economic growth at the beginning of the year benefited from an acceleration in agriculture and industry. Agriculture grew 3.0% year-on-year in Q1 (Q4: +2.7% yoy) and the industrial sector expanded 0.7% (Q4: +0.2% yoy). Meanwhile, services continued to show robust growth in the first quarter: the sector maintained Q4’s healthy 3.7% growth rate in Q1. The release of more complete data will be published on 20 May.

The Central Bank (Banxico) cut its growth forecast for 2016 and now sees the economy growing between 2.0% and 3.0% (previous estimate: 2.5% and 3.5%). For 2017, the Bank also revised Mexico’s growth prospects and now expects GDP to grow between 2.5% and 3.5% (previous estimate: 3.0% and 4.0%). According to the latest survey of analysts for the LatinFocus Consensus Forecast, panelists see the economy increasing 2.8% in 2016, which is unchanged from last month’s forecast. For 2017, the panel expects growth to pick up to 3.2%.

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Mexico GDP Chart

Mexico GDP Q1 2016

Note: Year-on-year changes of GDP in %.
Source: Mexico National Statistics Institute (INEGI)

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