Investment in Mexico
Mexico - Investment
Economy contracts at softer annual pace than initially reported in Q4 2020
According to a second estimate released by the INEGI on 25 February, GDP contracted 4.3% on an annual basis in the final quarter of 2020 (Q3: -8.6% yoy), revised slightly up from the flash estimate of 4.5%. Meanwhile, on a seasonally-adjusted quarter-on-quarter basis, economic output increased 3.3% (Q3: +12.4% s.a. qoq), also above the preliminary reading of 3.1%. For the year overall, GDP collapsed 8.2% (previously reported: -8.3%), marking the steepest decline in decades and the second successive year of falling output (2019: -0.1%).
The milder annual downturn reflected an improvement across most major sectors of the economy. The industrial sector shrank a softer 3.1% year-on-year (Q3: -8.7% yoy), largely owing to the manufacturing segment gaining momentum thanks to reviving external demand, particularly from the U.S. Moreover, activity in the services sector—the economy’s engine of growth—dropped 5.0% on an annual basis, less severely than the 8.9% fall logged in Q3, in part due to improving conditions in the retail and wholesale trade sectors. Meanwhile, primary activities lost steam, yet still grew a solid 4.8% in annual terms (Q3: +7.3% yoy).
GDP is poised to rebound in 2021, primarily on the back of the external sector as improving foreign demand buoys exports. Meanwhile, slow employment growth and subdued confidence could weigh on a robust revival of household spending and business investment. A still-raging pandemic, uncertainties over vaccine distribution and weak fiscal support cloud the outlook further.
FocusEconomics Consensus Forecast analysts see the economy expanding 4.0% in 2021, which is up 0.1 percentage points from last month’s forecast. In 2022, they see GDP growth at 2.7%.
Mexico - Investment Data
|Investment (annual variation in %)||5.0||1.0||-1.6||0.9||-4.9|
5 years of economic forecasts for more than 30 economic indicators.
|Bond Yield||6.87||-0.24 %||Dec 31|
|Exchange Rate||18.93||-0.29 %||Jan 01|
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February 25, 2021
The monthly indicator for economic activity (IGAE) ticked up 0.1% in month-on-month, seasonally-adjusted terms in December 2020, well below the 0.7% rise logged in the previous month and marking the softest increase since May 2020.
February 25, 2021
According to a second estimate released by the INEGI on 25 February, GDP contracted 4.3% on an annual basis in the final quarter of 2020 (Q3: -8.6% yoy), revised slightly up from the flash estimate of 4.5%.
February 11, 2021
At its first meeting of the year on 11 February, the Governing Board of the Bank of Mexico (Banxico) unanimously decided to chop the target for the overnight interbank interest rate by 25 basis points to 4.00%, after it stood pat in the two previous meetings.
February 9, 2021
Consumer prices rose 0.86% over the previous month in January, above the 0.38% rise logged in December 2020.
February 8, 2021
Consumer confidence firmed slightly at the turn of 2021, with the seasonally-adjusted consumer confidence indicator published by the Statistical Institute (INEGI) coming in at 38.4 points in January, up from December’s 38.2 reading.