The mexican economy It expanded at the end of 2021, indicated the Mexican Institute of Finance Executives (IMEF), when interpreting its anticipated measurements of key indicators of manufacturing production, consumption and services.
The IMEF Manufacturing Indicator increased 1.8 points in December to close at 52.6 units and remain in the expansion zone for the third consecutive month.
The IMEF Indicator ranges from 0 to 100 points and the level of 50 points represents the threshold between an expansion (greater than 50) and a contraction (less than 50) of economic activity.
For its part, the IMEF Non-Manufacturing Indicator registered an increase in December of 2.2 points to close at 52.6, remaining in the expansion zone for 10 consecutive months.
Thus, at the end of 2021, both the Indicator IMEF Manufacturing and Non-Manufacturing were located in the expansion zone, moving away from the 50-point threshold. Its cycle trend series accumulated 11 months in the expansion zone, which indicates that the country’s economic activity continued to expand throughout last year except for January, when the national economy suffered the third wave of infections.
“It should be noted that during December both IMEF Indicators compensated for the falls they had registered in November, clearly closing in the expansion zone. The figures of the IMEF Indicator reflect that economic activity continues to be very sensitive to the evolution of the pandemic and its effects on mobility ”, said the IMEF in its monthly report.
During October, the Global Economic Activity Indicator decreased 0.2% in relation to September and with seasonally adjusted figures. Agricultural activities decreased 1.2%, industrial activities increased 0.6% and services decreased 0.5%.
These results, especially the last one, confirmed that at the beginning of the fourth quarter, economic activity began with weakness, which may affect the growth estimate for the fourth quarter of the year.
The IMEF stated that the levels of Industrial production and services, which cover almost the entire production, are still below the readings recorded before the start of the pandemic, so it will be necessary to maintain growth to regain lost ground.
Within industrial production, the improvement in October compared to September was mainly explained by the monthly expansion of manufacturing production and public services, as construction continued to contract.
In terms of performance, there is still great heterogeneity between sectors. On the side of aggregate demand, gross fixed investment suffered a contraction of 1.6% in September compared to August, with figures adjusted for seasonality, after having grown by the same magnitude during the last month compared to the previous one.
Investment in construction, which represents 61.4% of the total, decreased 1.5% while investment in machinery and equipment, which covers 38.6%, fell 1.6%, both also compared to the previous month. The levels of gross fixed investment are below those registered before the pandemic and significantly below those registered during 2018.
For its part, private consumption in the domestic market registered an improvement in September compared to the level registered in August, an increase of 0.9%, also with figures adjusted for seasonality.
The consumption trend is clearly upward, however, it is still below the levels recorded during the pandemic.
Regarding external demand, in November total exports increased 5.7% compared to October, with figures adjusted for seasonality, highlighting manufacturing exports, which increased 7.3 percent.
Both total and manufacturing exports are the only component of aggregate demand whose current level has already exceeded that registered before the pandemic.