Mexico | Lower manufacturing dynamism in April; slow recovery forward

Summary

The BBVA Multidimensional Manufacturing Indicator (MMI) fell (-)2.9% YoY in April, pointing to an extended slowdown in the sector amid the deceleration of external demand

Key points

• Key points:
• Considering the April data, the annual percentage change of the MMI averages (-)1.6% during the first four months of the year (vs. 2.9% registered in the same period of 2023), which suggests slow growth for 2024.
• According to INEGI data, manufacturing production fell (-)0.1% QoQ in 1Q24, after the contraction of (-)0.4% recorded the previous quarter.
• In terms of used capacity, fourteen of the twenty-one subsectors are still at levels below their pre-COVID figure (vs. ten the previous month).
• Although the latest activity data in the US suggests that manufacturing production in that country may have already surpassed its lowest point in months, the path towards better levels will be slow and gradual, given the extended period of high interest rates and the depletion of accumulated household savings.

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