The Day at a Glance | March 3 2023

*Mexico`s Ministry of Finance and Public Credit (SHCP for its initials in Spanish) published the country`s public finance figures for January of 2023. 

*In China, the Caixin PMI for services exceeded the consensus estimate (54.5), with a 55.0 figure (+2.1) in February, its highest level in 6 months. Together with a positive surprise in the manufacturing index (51.6) made known on Tuesday, the composite indicator increased 3.1 points to 54.2 units, its highest reading in 8 months. 

*Producer inflation in the Eurozone receded by -2.8% on a monthly basis, significantly lower than the estimated -0.4%, resulting in an annual 15.0% figure, also below the estimated 17.8%, and marked a notable slowdown from the 24.6% logged in December. 

*The services and composite PMI`s in the Eurozone were both revised down 0.3pp for February, setting at 52.7 and 52.0 points, respectively. 

Economic environment

During the first month of the year, the budgetary balance logged a deficit worth -17.010 billion pesos, as a result of an increase in revenues and a decrease in spending. Total revenues recorded a 6.3% real annual rate of growth, highlighting the 11.2% increase in oil revenues, while non-oil revenues increased 5.6% in real annual terms. By classification, non-tax revenues hiked 8.0% in real annual terms, while tax revenues increased 5.5%. Regarding the latter, revenues from gasoline and diesel IEPS continued to fall, and logged a real annual reading of -40.7%. Although income tax reported a 9.8% increase in real annual terms. On the spending side, the Public Sector`s total net spending logged marginal changes in real terms compared to the same month of the previous year (-0.9% real annual). This containment in spending came from lower current spending, which decreased -10.2% in real annual terms, and lower capital spending, which logged a real annual decrease of -53.7%. Lastly, financial costs increased 37.1% in real annual terms, reflecting the increase in interest rates; although it remained below what was estimated by the Ministry of Finance.