Mexico: Manufacturing PMIs climb in September but remain deep in contractionary territory
October 1, 2020
The seasonally-adjusted manufacturing Purchasing Managers’ Index (PMI) produced by the Mexican Institute of Financial Executives (IMEF) edged up from 45.3 in August to 46.4 in September. Thus, it climbed further towards the 50-point threshold, indicating a softer contraction of the manufacturing sector. September’s increase was primarily driven by softer falls in production and employment compared to August. That said, new orders dropped at a slightly faster pace.
Similarly, the seasonally-adjusted manufacturing PMI produced by IHS Markit continued to rise from its all-time low in April, coming in at 42.1 in September (August: 41.3), marking the highest reading in six months. That said, it remained well below the 50-threshold, pointing to another sharp deterioration of business conditions in the manufacturing industry as Covid-19 continued to take its toll. September’s rise reflected softer contractions in new orders and employment, and most notably, businesses turning optimistic for the first time since March on an improved sales outlook to export markets.
Author: Javier Colato, Economist