The Day at a Glance | October 31 2023

*Mexico´s economy has strung together eight consecutive quarters of growth.

*The Eurozone´s GDP entered negative territory in the 3Q23.

*Inflation in the Eurozone positively surprised by falling to an estimated 2.9% y/y; the core component dropped to 4.9% y/y.

*China’s PMI´s disappointed in October with readings lower than those forecasted by the analysts’ consensus; the manufacturing index fell to 49.5 (previously 50.2), and the services index decreased to 50.6 (previously 51.7).

*The Bank of Japan is relaxing its control over interest rates as it approaches the end of its bond yield control.   

Economic environment

Mexico´s economy linked eight consecutive quarters of growth by posting a solid 0.9% q/q rate in the 3Q23. This rate compares favorably to the 0.8% q/q forecasted by consensus analysts, maintaining the same level of growth as in the 2Q23. There was a 3.2% q/q increase in primary activities, 1.4% in secondary activities, and 0.6% in tertiary activities during the 3Q23. As a result, on an annual basis, GDP logged 3.3% growth, indicating that Mexico´s economy continues to expand at a significant pace despite a slight slowdown compared to the previous quarter (3.6% prev.). When broken down by industry, there were positive figures in the primary sector (5.3%), secondary activities (4.5%), and the tertiary sector (2.5%). Taking all of this into account, GDP logged 3.5% growth during the first 9 months of the year, which highlights the strength and resilience of the Mexican economy through challenging international circumstances and the central bank´s aggressive restrictive policies. 

The Eurozone’s GDP contracted by -0.1% q/q during the 3Q23. This reading compares unfavorably to the 0.2% logged in the previous quarter, and marked the first contraction of the year. On an annual basis, the Eurozone’s economy recorded a modest 0.1% increase, a slowdown from the 0.5% y/y figure logged in the 2Q23, and was the slowest figure in over a year, although it remained in positive territory. Additionally, inflation in the Eurozone positively surprised by falling to 2.9% (4.3% prev.), following an estimated monthly +0.1% increase. However, these positive figures were tempered by the core component, which decreased from 5.5% to an estimated 4.9%, which would point to the fact that it remains high.