The advance of the vaccine against COVID-19 and a general return to the “green traffic light” will step on the accelerator of economic activity, but only in the short term, according to expectations presented today by the Mexican Institute of Finance Executives (IMEF ).
In Mexico, a variation in real GDP was confirmed in the first quarter of the year compared to the previous quarter of 0.8% or -2.8% compared to the same quarter of the previous year.
For the following quarters, a greater dynamism of production is expected since a general return to the “green traffic light” is anticipated very soon and that mobility and economic activity will gradually begin to recover levels more in line with pre-pandemic conditions, the agency reported it’s a statement.
However, for the medium term, structural improvements will largely depend on the dissipation of uncertainty about various public policies and the recovery of confidence to promote a decisive reactivation of private investment.
Recent indicators of industrial activity, investment, sales and production of automobiles, retail sales (from ANTAD partners), exports, imports and labor market indicators have shown improvements in their performance, although in some cases in an incipient manner, he explained. The document.
An important factor that must be considered when interpreting the evolution of practically all economic indicators is the “V” trajectory that they show. This pattern is congruent with a “rebound” effect of the variables, which responds to the pronounced contractions that occurred during 2020 at this time.
“In other words, relatively high annual growth rates are observed as a consequence of the base effect of comparison. These high growth rates should not be interpreted as a substantial improvement in the structural conditions of economic activity ”, reported the IMEF.
Indicators on the rise
Meanwhile, the IMEF manufacturing indicator rose 0.7 points in May to 52.3 units, thus remaining in the expansion zone — above 50 points — for the third consecutive month. Its trend-cycle series increased 0.7 points to settle at 52.4 units and register four consecutive months in the expansion zone.
The IMEF non-manufacturing indicator registered an increase in May of 1.9 points to close at 53.6 units and remain in the expansion zone for the third consecutive month. Its trend-cycle series increased 0.8 units to 52.9 and placed in the expansion zone for the fourth consecutive month.
The results of the IMEF Indicator confirm an improvement in economic activity in both the manufacturing and non-manufacturing sectors during May.
In the first, the important increases in the sub-indices of new orders and production stand out, which reached their highest levels since 2012 and 2018, respectively. As for the second, it stands out that all the sub-indices were located above or above the threshold of 50 points.
These results, together with the conjuncture analysis, allow us to anticipate a clear improvement in economic activity during the second quarter. However, significant risks remain for growth in the medium term, he warned.
