Mexico Economic Outlook. March 2024

Summary

Downward revision to our 2024 Gross Domestic Product (GDP) growth estimate to 2.5% (2.9% previously), with lower dynamism of domestic demand.

Key points

• Key points:
• The gains in real wage bill and the trend towards lower savings, among the factors that would avoid a contraction in private spending this year.
• Slowdown in investment due to deceleration in public construction, including some machinery and equipment segments.
• The slowdown in formal job creation will continue in 2024; despite this, employment is expected to grow by 2.8%.
• The higher public deficit approved for 2024 will take the Historical Balance of Public Sector Borrowing Requirements to 49.0% of GDP by year-end vs. 46.8% of GDP in 2023.
• There is ample room to gradually normalize the monetary policy stance, but it will remain restrictive despite the gradual rate cut cycle to 9.25% by year end that we foresee.

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