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Mexico: GDP growth accelerates in third quarter

November 21, 2014

In the third quarter, GDP increased 2.2% over the same period last year, which marked an acceleration over the 1.6% expansion registered in the second quarter. Nonetheless, Q3’s expansion fell short of the 2.3% increase the markets had expected.

Q3’s improvement was broad-based and reflected faster growth in agriculture (Q3: +7.3% year-on-year; Q2: +2.5% yoy), which marked the fastest pace of expansion since the fourth quarter of 2012. In addition, the industrial sector grew a healthy 2.0% in Q3, which came in above the 1.1% rise observed in Q2. Construction showed a meaningful improvement, bouncing from a 0.6% contraction in Q2 to a strong 4.0% increase in Q3. Services also increased 2.0% in Q3, which was a notch up the 1.9% rise recorded in Q2.

A quarter-on-quarter comparison showed that GDP increased a seasonally-adjusted 0.5% in Q3, which came in below the revised 0.9% expansion observed in Q2 (previously reported: +1.0% qoq). According to analysts, the Mexican economy will experience softer growth in the second half of the year.

In November, the Central Bank (Banxico) revised Mexico’s growth forecasts and now expects the economy to grow between 2.0% and 2.5% in 2014 (previous estimate: 2.0% and 2.8%). For 2015, the Bank also lowered its projections and now sees the economy growing between 3.0% and 4.0% (previous estimate: 3.2% and 4.2%). LatinFocus Consensus Forecast panelists’ projection is in line with the government’s assessment. They see the economy increasing 2.4% in 2014, which is down 0.1 percentage points from last month’s forecast. For 2015, the panel expects growth to pick up to 3.7%, which is unchanged from last month’s estimate.


Author:, Senior Economist

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Mexico GDP Q3 2014

Note: Year-on-year changes of GDP in %.
Source: Mexico National Statistics Institute (INEGI) and LatinFocus Consensus Forecast.


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