Mexico’s economy would grow up to 1.4 percent in 2023, even though a slower pace is expected in the manufacturing sector, Banco Bilbao Vizcaya Argentaria (BBVA) estimated Thursday.
The institution upgraded its forecast for this year from 0.6 percent as it anticipates further momentum in domestic demand amid a continued increase in household spending.
“Wage revisions and the expectation of lower inflation will be key in maintaining the pace of real wage and wage bill growth, which will benefit household consumption,” BBVA explained in its first quarter Mexico Situation Report.
Regarding industrial activity, the document anticipates an eventual weakening of manufacturing production in the following months while the lower growth in demand for durable goods in the United States materializes.
Regarding inflation, the private institution indicated that the price index is declining, and the trend points to a more pronounced deceleration in the coming months.
Inflation could close the year at 4.8 percent, down from 7.12 percent year-on-year to the first two weeks of March.
The Mexican economy, the second largest in Latin America after Brazil, grew 3.1 percent in 2022 from the 4.7 percent expansion observed the previous year.