Private Consumption in Mexico
GDP growth beats expectations in Q1
According to a preliminary reading, GDP growth accelerated to 1.1% on a seasonally adjusted quarter-on-quarter basis in the first quarter, from 0.5% in the fourth quarter. Q1’s reading surprised markets to the upside.
The reading was underpinned by the services and industrial sectors, which expanded 1.5% and 0.7% respectively. Services activity was likely aided by falling inflation, strong remittances, wage gains and a lower unemployment rate, while industrial production should have been boosted by rising vehicle production amid a fading chip shortage. In contrast, the primary sector declined 3.2%.
On an annual basis, economic growth waned notably to 3.6% in Q1, compared to the previous period’s 3.7% expansion.
Regarding the outlook, Itaú Unibanco analysts said:
“We increased our GDP growth forecast for this year to 2.4% (compared with our previous scenario of 1.8%) given a stronger-than-expected 1Q23. Nonetheless, we still expect sequential GDP to slow down in the last three quarters of the year, dragged down by a softer U.S. economy and tight monetary policy stance.”
Mexico Private Consumption Chart
Mexico Private Consumption Data
|Private Consumption (ann. var. %)||3.2||2.6||0.4||-10.3||7.6|