According to preliminary estimates from Mexico’s national statistics agency INEGI, the country’s economy performed better than expected in the first quarter of the year compared to the previous three months. The economy experienced a 0.2% growth in gross domestic product (GDP) on a quarter-on-quarter basis, slightly exceeding the 0.0% that economists had predicted. This growth was primarily driven by an increase in services, although there was a decline in the primary sector.
On a yearly basis, however, Mexico’s economy slowed down, expanding by only 1.6% compared to the same period last year. This growth rate was lower than the 2.5% growth seen in the previous quarter and below the expected 2.1% growth. Chief Latin America Economist at Pantheon Macroeconomics, Andres Abadia, attributed this slowdown to various challenges including tighter financial conditions, difficult external conditions, and increased infrastructure spending. These factors contributed to the overall deceleration of economic growth in the first quarter.
Despite this slowdown, Mexico’s economy has now grown for ten consecutive quarters. While there is still growth momentum, it appears weaker compared to recent trends. The figures indicate that Mexico’s economic growth continued to face challenges in the first quarter but remains on a path of expansion.