Mexico: Economic activity gathers momentum at the outset of the year
March 25, 2013
In January, economic activity expanded 3.2% over the same month last year, according to the IGAE (Indicador Global de la Actividad Economica). The reading came in well above both the 1.4% increase recorded in December and market expectations, which had economic activity rising 2.6%.
The improvement was broad-based, as all three major categories - agriculture, industry and services - fared better compared to the previous month. In particular, agricultural output expanded a robust 13.4%, which followed an 11.5% annual increase in December.
A month-on-month comparison corroborates the acceleration suggested by the annual data, as in January economic activity expanded a seasonally adjusted 0.20%, which contrasted the 0.97% decline seen in December. That said, despite the solid expansion, the trend continues to point downwards, with annual average growth in economic activity falling a notch to 3.9%.
In its latest inflation report from February, the Central Bank projects the economy to grow between 3.0% and 4.0% this year and between 3.2% and 4.2% in 2014. LatinFocus panellists share the Bank's assessment and see the economy growing 3.5% this year, which is unchanged from last month's forecast. For next year, the panel expects growth to pick up to 3.9%.