Mexico Economic Activity April 2016

Mexico

Mexico: Economic activity accelerates in April

June 23, 2016

Mexico’s economic activity, measured by INEGI’s monthly economic activity indicator (EGAE), increased 3.0% year-on-year in April, which marked an acceleration over the 1.2% expansion registered in March. The reading came in below the 3.4% increase the markets had expected. According to INEGI, the monthly acceleration was mainly the result of a return to growth in the manufacturing and agricultural sectors, which had experienced steep contractions in March. The services sector grew at a faster pace than in March.

A month-on-month comparison showed that economic activity contracted a seasonally-adjusted 1.2% in April, which came in below the 0.2% contraction seen in March. April’s reading marks the steepest contraction recorded in over seven years.

The trend continued to suggest that growth in economic activity remains broadly stable. Annual average growth in economic activity inched up from 2.4% in March to 2.5% in April.

In late May, the Central Bank (Banxico) left its growth forecast for 2016 unchanged at between 2.0% and 3.0%, but revised its forecast for 2017. The Bank now expects GDP in 2017 to grow between 2.2% and 3.3% (previous estimate: between 2.5% and 3.5%). According to the latest survey of analysts for the LatinFocus Consensus Forecast, panelists see the economy increasing 2.4% in 2016, which is unchanged from last month’s forecast. For 2017, the panel expects growth to pick up to 2.8%.


Author:, Economist

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Mexico Economic Activity April 2016 0

Note: Year-on-year changes and annual average growth rate of monthly economic activity in %.
Source: Mexico National Statistics Institute (INEGI)


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