Published on Thursday, July 6, 2023 | Updated on Friday, July 7, 2023

Mexico | The Mexican economy is growing at a good pace

Everything indicates that the country's economic growth in the first half of this year will be good and higher than expected. The year's first quarter growth (QoQ) was 1%, which implies a growth rate greater than 4% in annualized rates

Key points

  • Key points:
  • This performance is due, first of all, to the robustness of consumption explained by the labor market's strength. Today the unemployment rate stands at 2.8%, a historically low level and less than the 3.6% observed before the pandemic
  • Not only are there more jobs in Mexico, but they are also better paid: the average real wage has risen by about 6% since January of last year, partly due to increases in the minimum wage and partly due to wage pressures that result from the lowest unemployment rate
  • Another factor behind the good economic performance this year is the solid pace of manufacturing due to the surprising resilience of the US economy
  • At BBVA, we estimate that if the US economy enters a recession in the second half of the year (our baseline scenario), growth in 2023 would be 2.4%. But if the US economy manages to avoid recession, the Mexican economy could grow at 3% or more

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