Mexico: Economic activity decelerates further in August
October 24, 2014
INEGI’s monthly economic activity indicator (IGAE) showed that economic activity increased 1.3% in August over the same month last year. The reading marked a notable deceleration over the 2.5% expansion observed in July and came in below the 2.3% rise the market had expected. Economic activity’s trend stabilized; annual average growth remained stable at July’s 1.5% in August.
August’s reading was the result of a slowdown in both the industrial sector and services. Industry increased 1.4% annually in August, which was down from the 2.0% expansion tallied in July. Annual growth in services fell from 2.5% in July to 1.0% in August, the slowest rate in nine months. Only growth in agriculture improved over the previous month (August: +7.6% year-on-year; July: +7.5% yoy).
A month-on-month comparison points to a worse deterioration than the slowdown suggested by the annual data. Economic activity slipped a seasonally-adjusted 0.17% in August, which contrasted the 0.33% increase registered in July.
Author: Ricardo Aceves, Senior Economist