Mexico: Manufacturing PMIs diverge but still languish
December 1, 2020
The seasonally-adjusted manufacturing Purchasing Managers’ Index (PMI) produced by the Mexican Institute of Financial Executives (IMEF) slipped to 48.5 in November from 49.6 in October. Thus, it remained below the critical 50-point threshold, where it has been for the past year-and-a-half, indicating a contraction of the manufacturing sector. November’s dip was primarily driven by a pullback in new orders and production, after both had expanded in the prior month. Employment, meanwhile, declined at an even sharper pace.
In contrast, the seasonally-adjusted manufacturing PMI produced by IHS Markit ticked up to an eight-month high of 43.7 in November (October: 43.6). That said, it remained well below the 50-threshold, pointing to another sharp deterioration of business conditions in the manufacturing industry. Both new orders and output fell at a steeper clip and for the ninth month running in November amid weak demand. Businesses remained pessimistic towards future output and cut back on their staff levels again.
Author: Javier Colato, Economist