• Tue. Jun 6th, 2023

UPDATE 3-Mexican financial system grew for sixth consecutive quarter in Q1


May 27, 2023

(Provides particulars in first paragraph, economist feedback in paragraphs 5-7)

Could 26 (Reuters) – Mexico’s financial system grew for the sixth quarter in a row within the first quarter, information from Latin America’s second-largest financial system confirmed on Friday, with progress in keeping with market expectations.

Gross home product (GDP) elevated 1.0% within the interval from the earlier three months, statistics company INEGI stated, matching forecasts from economists in a Reuters ballot.

The determine, nevertheless, got here in barely under preliminary estimates disclosed by INEGI a month in the past, when the statistics company stated GDP had seemingly elevated 1.1% within the interval on a sequential foundation.

Economists had already dubbed the preliminary first quarter information as “strong,” though famous a slowdown within the U.S. financial system and tight financial coverage would most likely soften Mexico’s efficiency within the coming quarters.

“General, these numbers verify a good begin to the 12 months,” Pantheon Macroeconomics’ chief economist for Latin America, Andres Abadia, stated about Friday’s figures. “However sequential information is confirming a gradual deterioration in current months.”

Extra indicators launched by INEGI confirmed that financial exercise within the nation shrank 0.3% in March from the earlier month.

Abadia stated the “excellent news” was that fading progress momentum and falling inflation would make it simpler for the central financial institution to undertake a dovish tone quickly after pausing a virtually two-year rate-hike cycle earlier this month.

The quarterly GDP progress, in accordance with INEGI, was pushed by a 1.5% leap within the tertiary or service sector and a 0.6% enhance in secondary actions, which comprise manufacturing.

Main actions equivalent to farming, forestry, fishing and mining, nonetheless, shrunk by 2.8%.

In annual phrases, the company added, the financial system expanded 3.7% within the first three months of 2023 in comparison with a 12 months earlier. That was barely under the three.9% progress anticipated by the market and projected by final month’s preliminary information. (Reporting by Gabriel Araujo; enhancing by Steven Grattan, Jason Neely and Conor Humphries)

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