Mexico: Manufacturing PMIs diverge in February but remain in contractionary mode
The seasonally-adjusted manufacturing Purchasing Managers’ Index (PMI) produced by the Mexican Institute of Financial Executives (IMEF) slipped to 49.1 in February from 49.4 in January, Thus, it remained below the critical 50-point threshold, where it has been for nearly two years, indicating a contraction of the manufacturing sector. February’s dip was mainly driven by falling inventories after they rose in the previous month. More positively, both new orders and employment rebounded back to growth, while the decline in production eased.
In contrast, the seasonally-adjusted manufacturing PMI produced by IHS Markit climbed from 43.0 in January to 44.2 in February, the highest reading in almost one year. Nevertheless, it remained well below the 50-threshold, pointing to another sharp deterioration of business conditions in the manufacturing industry. Both output and new orders contracted at a softer pace compared to January. That said, the degree of decline remained sharp amid weak domestic and foreign demand due to the pandemic. Meanwhile, business confidence reached a one-year high on hopes that the vaccine deployment will help normalize business operations.