Mexico Economic Outlook
September 15, 2020Although a second estimate revised the plunge in Q2´s GDP upwards, the collapse remained unprecedented, reflecting a contraction across virtually all sectors as the Covid-19 fallout took its toll. A solid month-on-month rebound in industrial production, private consumption and fixed investment in June, however, indicates that activity began to recover at the tail end of Q2 amid the easing of restrictions. Turning to Q3, remittances grew solidly again in July, defying expectations, while consumer confidence continued to creep up through August, boding well for consumer demand. That said, both the manufacturing and services PMIs surprisingly slipped in August, raising concerns over a loss of recovery momentum. Meanwhile, the government revealed a lean draft budget for next year on 8 September, sticking with fiscal discipline over spurring a recovery.
Mexico Economic GrowthThe economy is expected to contract at the sharpest pace since the 1995 tequila crisis this year due to pandemic’s blow. A spike in unemployment and underemployment will pummel household spending, while investment activity will remain depressed amid heightened uncertainty. Weak demand from the U.S. and a prolongation of the health crisis pose key risks to the outlook. FocusEconomics panelists project the economy to contract 9.8% in 2020, which is down 0.5 percentage points from last month’s forecast, and grow 3.7% in 2021.
Mexico Economy Data
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Mexico Economic News
September 9, 2020
Consumer prices rose 0.39% in August over the previous month, which was below the 0.66% increase logged in July.
September 4, 2020
Consumer confidence continued to climb in August from April’s three-year low when Covid-19 began to take its toll, with the seasonally-adjusted consumer confidence indicator published by the Statistical Institute (INEGI) coming in at 34.6 points, above July’s 34.1 reading.
September 1, 2020
Remittances totaled USD 3.5 billion in July (June: USD 3.5 billion), representing a 7.2% increase from the same month a year ago but easing from the 9.9% jump logged in June.
September 1, 2020
The seasonally-adjusted manufacturing Purchasing Managers’ Index (PMI) produced by the Mexican Institute of Financial Executives (IMEF) slipped from 47.8 in July to 45.0 in August.
August 27, 2020
Merchandise exports dropped 8.9% on annual basis in July, less severely than June’s 12.8% decline.