Published On: Mon, Aug 24th, 2015

Mexican Economic Growth Forecast is Adjusted After Peso Hits Historic Low

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The Mexican Treasury and Public Finance Secretariat (SHCP) is lowering its economic growth forecast for 2015 to between 2 percent and 2.8 percent.

The new figure is down from a previous projection of 2.2 percent to 3.2 percent GDP growth.

Thursday’s adjustment comes as the Mexican peso is at a historic low against the U.S. currency, closing at 16.52 per dollar on Wednesday August 19th.

Analysts attribute the slide to an expected interest rate hike in the United States and lower prices for oil, a main driver of the Mexican economy.

Mexico’s Central Bank (Banxico) also recently lowered its own 2015 economic growth forecast, which is currently 1.7 percent to 2.5 percent.

SHCP Undersecretary Fernando Aportela Rodríguez said that this forecast is consistent with the performance of the national economy, which grew from last year despite a fluctuating international environment.

In a press conference, Aportela said that the 2.2 percent growth registered by the Mexican economy in the second quarter of 2015 exceeded the 1.7 percent growth reported during the same period in 2014.

In the first half of 2015, the economy grew 2.4 percent compared with a 1.8 percent growth during the first half of 2014, he said.

SHCP Undersecretary Fernando Aportela Rodríguez speaks about Mexican economic growth forecasts in Mexico City. (Photo: CUARTOSCURO/ ISABEL MATEOS)

SHCP Undersecretary Fernando Aportela Rodríguez speaks about Mexican economic growth forecasts in Mexico City. (Photo: CUARTOSCURO/ ISABEL MATEOS)

Mexico has greater economic growth than Latin American economies, Aportela said. During the second quarter of 2015, Chile and Argentina showed 1.6 and 0.6 percent growth, respectively, and Brazil registered 1.2 percent economic growth, he said.

The U.S. economy has reverted to a deceleration in the first quarter of 2015 and its economic forecast for all of 2015 stands at 2.4 percent, he said.

U.S. Industrial production, which impacts the Mexican economy, slowed down in the first and second quarter of 2015.

For July, the seasonally adjusted monthly rate was positive and there are expectations that growth will stabilize and have a positive performance at the close of 2015.

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