Mexico: Economic activity slows down
July 25, 2013
According to the IGAE (Indicador Global de la Actividad Economica), economic activity in May increased 1.7% over the same month last year. The expansion marks a notable deceleration compared to the 4.5% increase observed in April. The print fell slightly short of market expectations, which had economic activity increasing 1.8%.
According to the national statics office, the deceleration observed in May was broad-based. All three major sub-categories that compose the index - agriculture, industry and services - slowed down over the previous month. On a sequential basis, however, economic activity expanded a seasonally adjusted 0.45% in May, which contrasts the 0.71% decline observed in April.
As a result of the weaker annual reading, the trend continues to deteriorate, with annual average growth in economic activity falling from 2.9% in April to 2.7% in May, which marks the lowest reading in nearly three years.
LatinFocus panellists see the economy growing 3.5% this year, which is unchanged from last month's forecast. The panel expects growth to pick up to 3.9% in 2014.
Author: Ricardo Aceves, Senior Economist