Economics: 2023 growth projections upwardly revised to 1.8%, but reduced for 2024
Consumption and gross fixed capital formation figures for the first two months of the year, as well as preliminary GDP growth data for the first quarter (3.9%) were higher than expected, leading us to upwardly revise our growth projection for 2023 to 1.8%. Although the expectation of a recession in the United States continues, it is very likely that it will begin to materialize in late 2023 and early 2024, affecting Mexican manufacturing exports. Taking this into account, our growth estimate figure for 2024 was revised downward, to 1.5%.
Private consumption was uneven, since spending on domestic products rose only 0.2%, while consumption of services increased considerably, which influenced growth in GDP in the first quarter. Investment corresponding to machinery and equipment maintains high growth rates and has already surpassed its pre-pandemic levels. In the case of construction, however, high increases have been posted recently, but nevertheless, investment in construction remains 11.8% below January 2019 levels.
Considering the growth forecasts for 2023 and 2024, average annual growth during President Andrés Manuel López Obrador’s administration is expected to clock in at 0.5%, a level insufficient to generate the required jobs and reduce the poverty levels that rose as a result of the effects of the pandemic in 2020.
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