A Reuters poll on Tuesday showed that Mexico’s economy would have slowed in the third quarter due to the third wave of COVID-19, especially due to the advance of the highly contagious variable delta, and bottlenecks in supply chains.
The median forecast of 13 analysts puts a rise between July and September of 0.1% for GDP, compared to 1.5% growth in the second quarter, according to seasonally adjusted figures.
At an annualized rate, gross domestic product had advanced 6.0% in the third quarter, compared to a 19.6% expansion in the original numbers from the previous period, according to the survey.
“The economic recovery weakened in the third quarter due to a double effect: the acceleration of the epidemic and the exacerbation of semiconductor shortages, which had a significant cost to domestic production,” said Alfredo Coutinho, director of analysis for Latin America at Moody’s Analytics.
Meanwhile, Citibanamex stated that the slowdown in activity is also due to a slowdown in economic expansion in the United States, Mexico’s main trading partner.
Activity in Latin America’s second-largest economy unexpectedly contracted 1.6% in August, its worst drop in 15 months. After the data was released on Monday, many analysts revised down their third-quarter forecasts.
The Mexican economy suffered an 8.5% contraction last year, its worst performance since 1932 during the Great Depression. Private sector analysts expect a 6.2% expansion at the end of this year, according to a Banco de México survey published earlier this month.
On Friday, the statistics institute INEGI will release its timely GDP estimate for the third quarter of 2021. The final revision will be released on November 25.
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