Mexico’s economy had one of the worst overall performances among the main countries in the Latin American and Caribbean region in the third quarter of this year. In addition, a complicated outlook is estimated for the end of 2024, according to analysts.
The National Institute of Statistics and Geography (INEGI) revealed the timely estimate of Mexico’s Gross Domestic Product (GDP) for the reference period, giving an annual growth of 1.45%, with seasonal adjustment.
Given this result, EL CEO calculated the performance of the five largest economies in the Latin American region in the third quarter of 2024, through monthly indicators of economic activity, proxies for GDP, obtained from the central banks of each country until last August.
The five largest economies in Latin America and the Caribbean are Brazil, Mexico, Argentina, Colombia and Chile, which together contribute more than 80% of the region’s GDP.
The place of Mexico’s economy
First place went to Colombia with an estimated increase of 3.03% of its economic activity in the penultimate part of this year; followed by Chile with an increase of 2.46%.
Third place went to Brazil, the largest economy in Latin America and the Caribbean with 32.9% of the regional GDP, as it achieved an annual growth of 1.99%.
In the case of Mexico, the second largest economy in the region with 27.1% of the GDP, it was in fourth place by achieving an annual increase of 1.45%, while Argentina’s economy contracted 4.15%.
Difficulty for 2024
For analysts at Ve por Más (BX+), it is difficult for economic activity to maintain a positive pace at the end of the year, which is why it decided to maintain its forecast for Mexico’s GDP growth for all of 2024 at 1.3%.
Private consumption will still find support in the strength of the labor market and the growth in wages. However, we expect a further moderation in more discretionary spending, since job creation has lost strength, and inflation and interest rates – although they would decrease somewhat – will remain high, detailed specialists from the financial group.
BX+ analysts, through a report, added that gross fixed investment would continue to slow down as the expansion in public works is reversed, while private investment faces still high financial costs and uncertainty due to constitutional reforms and the presidential election in the United States.
In the medium and long term, they point out, adjustments in the institutional framework that erode legal certainty in the country would limit the attraction of new investments, even those associated with industrial reorganization.
Source: elceo
