The Day at a Glance | September 4 2023

*Private consumption figures in Mexico continued to show strong progress in June, following the update of Mexico’s National Accounts System and the release of the new 2018 base series. Similarly, data for gross fixed investment in June recorded double-digit annual growth.

*Family remittances set at $5,651.5 million dollars (USD) in June, a 6.6% y/y increase, primarily driven by a 5.9% increase in the number of transactions. With this, in the first seven months of the year, remittances have accumulated a total amount of $35,895.5 million USD.

*INEGI (Mexico’s National Institute of Statistics and Geography) published figures for its cyclical indicators system for June: the coincident indicator exceeded its long-term trend by recording a level of 101.1 points (+0.06); the leading indicator remained above the long-term trend with a reading of 100.4 points (+0.11).

*In the Eurozone, the investor confidence index Sentix fell to -21.5 units in September from the -18.9 observed in August and below the consensus forecast of -20.0 points. 

Economic environment

Private consumption in Mexico recorded 4.1% annual growth in June. It’s worth pointing out that the INEGI updated the National Accounts System, and has started to use a new series based on 2018. With this, June´s reading was higher than the 3.9% y/y average recorded in the last six months, which was still based on the 2013 series. On a monthly basis, there was a 0.3% m/m increase, driven by imported goods, which increased 2.4% m/m, offsetting the -0.1% m/m decline in domestic goods and services, which logged a monthly -0.6% decrease in national goods, while services increased 0.5% m/m. With this, the annual reading indicated that imported goods grew by 20.9%, while domestic goods and services hiked 0.9% y/y with a positive performance in services (5.5% y/y), but consumption of national goods fell by -2.9% y/y. Similarly, figures for gross fixed investment stemmed from the new 2018 base series, with robust progress in June. Gross fixed investment recorded a monthly 3.1% increase (and 28.6% annual), with construction being the main growth driver (4.2% m/m and 36.9% y/y); Additionally, the machinery and equipment category also recorded a strong pace of growth (2.1% m/m and 20.1% y/y), with double-digit annual growth in the imports component (28.0%) and domestically sourced components growing by 7.7% y/y. This was driven by machinery, equipment, and other domestically sourced goods, which recorded a -7.2% y/y decline. Overall, June´s figures indicate there was robust demand at the end of the 2Q23.