Mexico | Manufacturing sluggishness extends into 3Q24

Summary

The BBVA Multidimensional Manufacturing Indicator (MMI) fell (-)3.1% YoY in August (the eighth consecutive drop so far this year), confirming the slow dynamism of the sector so far in 2024.

Key points

• Key points:
• Considering the August data, the year-on-year variation of the MMI averages (-)2.3% for the January-August period of this year, 4.9 pp below the figure recorded in the same period of the previous year.
• The most recent figures for the manufacturing sector in the US suggest that the sector's production may have already surpassed its lowest point, as household spending patterns normalize.
• According to the latest figures on US economic activity, retail sales have slowed the pace of their decline in 3Q24, with an average year-on-year change of (-)0.8% during the January-August period, 0.3 pp above that recorded in the same period of the previous year.
• We anticipate that the gradual recovery of the segment will materialize through 2025, as the downward cycle of interest rates continues, with income recovering.

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