The Mexican Ministry of Finance announces that 2015 budget is cut in 0.7% of GDP

Summary

The Ministry of Finance said the the budget cut represents 2.6% of the total federal current expenditure, figure that is equivalent to 0.7% of GDP. Due to the fact that this budget cut is moderate, it is concentrated in current expenditure and public expenditure in the past had a limited effect on GDP´s growth, we expect that this fiscal measure has a limited impact in 2015 GDP´s. Note also that if the US economy keeps growing at a fast pace, this could ba a factor that may offset the effect of the budget cut in the Mexico´s 2015 GDP. Note also that this measure is positive in the sense that it will mitigate the adverse effect that low oil prices could have in the economy in 2016

Geographies

Topics