Mexico’s economy is one of the bright spots in Latin America right now, but recent forecasts continue to revise down just how much it is growing.
Growth estimates for this year continue to decrease. The latest number is 2.3%, reported by the Wall Street Journal today, down from a 2.5% forecast in September. At the start of the year, the government had forecasted 3.9% growth, according to Reuters, but then experienced a pretty terrible first half of the year. Growth has been moderately good in the third quarter, but not great.
It should be said that even 2% growth is better than a lot of countries in Central and South America. At last week’s meeting, the Banco de Mexico announced interest rates would remain unchanged at 3%, citing new signs of weakness in the global economy.
In a note to clients this week, UBS wrote, “Contrary to most countries in the region, Mexico’s economy is on a clear upswing and closely tied to the United States. But a failure to implement capital spending effectively by the government has led to lower than expected growth this year, a phenomenon that we think will still weigh on the economy in 2015.”