Mexico: Economic activity shrinks in May
Latest reading: Economic activity was down 0.3% on a seasonally adjusted month-on-month basis in May, following a 1.4% rise in the previous month.
Relative to the prior month’s data, readings in May worsened for the services sector (+0.2% on a seasonally adjusted month-on-month basis vs +0.8% in April), the industrial sector (-0.8% vs +2.1% in April) and the primary sector (-0.5% vs +2.8% in April).
On a year-on-year basis, economic activity increased 1.1% in May, following a 2.6% increase in the previous month.
Panelist insight: On the reading and outlook, Itaú Unibanco analysts said:
“Despite the decline in May, economic activity continues to exhibit some underlying momentum. […] Looking ahead, we expect growth to moderate in the second half of the year as subdued household spending, softer labor-market conditions, and the fading boost from World Cup-related expenditures weigh on domestic demand. While the domestic backdrop is likely to remain challenging, the external sector should continue to provide an important offset.”