The Day at a Glance | June 7 2023

*The Organization for Economic Cooperation and Development (OECD) published its new global growth estimates, which included a slight upwards revision. 

*China published its May trade balance figures. The 65.81 billion dollars (USD) set significantly lower than the expected 95.45 billion USD. In a disaggregate manner, exports decreased -7.5% y/y (vs -1.8% e.), while imports decreased -4.5% y/y (vs -8.0% y/y e.). 

*The United States trade balance logged a deficit worth $74.6 billion in April, which was less than the expected $75.8 billion deficit. 

*The Mortgage Bankers Association in the United States reported a 1.4% weekly decrease in the number of mortgage applications during the week ending on June 2nd. 

*The Ministry of Finance and Public Credit (SHCP for its initials in Spanish) will conduct an auction – through the Central Bank of Mexico – on June 8th, for the syndicated placement of the M Bond maturing in September 2026. Additionally, on June 12th, a swap auction will take place where bidders will deliver M Bonds and short-term Udibonos in exchange for receiving M Bonds with maturities between 3 and 13 years and Udibonos with maturities of 10 and 20 years. 

Economic environment

The OECD adjusted its 2023 global growth forecast to 2.7% (+0.1pp). This estimate implies the second slowest annual global growth rate since the financial crisis, only behind 2020 when the global health crisis occurred. Additionally, the OECD warns of a lengthy recovery process. For 2024, the organization forecasts a 2.9% rate of growth in the global economy. For the United States, growth estimates for 2023 and 2024 were set at 1.6% and 1.0%, respectively, while for Mexico, 2.6% and 2.1% growth rates are expected. Regarding inflation, the OECD expects it to become more moderate and allow an increase in real income. However, the persistence seen on the underlying inflation front calls for the need to maintain a restrictive monetary stance. Lastly, the OECD pointed out that pressures on government fiscal balances require prioritizing structural reforms that strengthen long-term potential growth.