The Day at a Glance | Sep 20 2022

The Top

*Mexico´s economy grew 2.9% annual during August, according to the Timely Indicator of Economic Activity.

*Inflation for producers logged a new record high during August (7.9% monthly; 45.8% annual).

*US Senators are preparing a proposal for sanctions to be carried out against companies and countries that facilitate Russian oil trade.

*Shanghai presented an infrastructure investment package worth 257 million dollars to reactivate the economy.

Economic environment

Growth in Mexico accelerates. According to Timely Indicator on Economic Activity forecasts made public by the INEGI, Mexico´s economy grew 2.9% annual during August, an acceleration with respect to previous months. This is the fastest monthly rate of expansion since August 2021 and suggests that there is still strength in Mexico´s economic recovery. The highest rates of growth were recorded in the services sector, according to the estimates, and suggest that there was a 2.6% annual rate of growth in the tertiary sector, level way above the 7-year average (0.84%). Meanwhile, the industrial sector could have slowed down during August with respect to July (3.1% annual vs 3.5%), although it´s rate of growth remains above 3% since May. The data points out that the domestic market´s recovery has strengthened during the second half of the year, while growth in the industrial sector has stabilized. If the firm recovery in domestic demand is maintained, the likelihood of seeing Mexico´s growth set above 2% this year will increase considerably. The primary sector is not part of the estimates due to its relatively small proportion of GDP, and growth during August is estimated to set at between 0.8%-4.9% with a 95% confidence level.