Mexico Economy Contracts for 1st Time since 2009


The Mexican economy shrank 0.8 percent year-on-year in the second quarter of 2019, compared to a preliminary reading of a 0.7 percent contraction and a 1.2 percent growth in the previous period, matching market expectations. It was the first yearly economic contraction since the last quarter of 2019, mainly due to a decline in industrial activity.

The industrial sector shrank 3 percent in the second quarter of the year, faster than a 0.6 percent contraction in the previous quarter, of which manufacturing (-6.9 percent vs -0.7 percent); mining (-7.8 percent vs -7.6 percent), as non oil (-4.2 percent vs -1.2 percent) while oil (-9.2 percent vs -10.3 percent); and construction (-6.9 percent vs -0.7 percent). Meantime, utilities grew 0.7 percent, recovering from a -0.2 percent contraction in the first three months of the year.

Services acitivities showed no growth in Q2, after expanding 1.8 percent in the previoy period. Output dropped in retail trade (-4.0 percent vs 0.5 percent); information & communication (-5.0 percent vs 0.1 percent); and professional, scientific and technical services (-2.7 percent vs 5.6 percent). Also, output went down further in corporate services (-5.0 percent vs -3.0 percent) and growth slowed in wholesale trade (2.1 percent vs 2.9 percent); transport & storage (0.5 percent vs 1.1 percent);  finance & insurance (2.1 percent vs 6.3 percent); real estate activities (1.0 percent vs 1.7 percent); and business services (5.8 percent vs 7.7 percent). On the other hand, output rebounded in both food & accomodation services (2.1 percent vs -1.3 percent) and cultural and sports activities (0.3 percent vs -2.4 percent).

The primary sector advanced 1.4 percent, easing from a 5.7 percent in the second quarter of 2018. 

On a quarterly basis, the economy stalled, after an upwardly revised 0.3 percent contraction in the previous period, and below a preliminary reading of a 0.1 percent expansion.

Mexico Economy Contracts for 1st Time since 2009


INEGI | Stefanie Moya | stefanie.moya@tradingeconomics.com
8/23/2019 11:29:23 AM