The United States is not in a recession, and Mexico is stagnant

The two consecutive negative quarters in the US are far from putting this economy into a recession.

While Mexico, although it still maintains positive GDP growth rates, is far from making a recovery.

Of course, the two economies share the weight of high inflation, although the effects are different.

The weak point of inflation in the United States is energy prices, while in Mexico, with tax subsidies on gasoline, the biggest problem is food prices.

In terms of growth rates, we have today in Mexico publishing preliminary data for the second quarter of 2022 of GDP which is expected to be somewhat positive, after knowing the 1% expansion in the quarterly comparison for the period from January to March. in the same year.

Meanwhile, in the US, if we see GDP behavior in numbers comparable to the way the data is published in Mexico, we are seeing a -0.4% decline during the first quarter, and, according to the first reading, a -0.23% decline during the second quarter.

Two consecutive quarters in Mexico with positive results, and two consecutive quarters with negative results in the United States. However, this economy is far from stagnating as it maintains high consumption rates, levels not far from full employment, and a significant reduction in poverty levels following the economic effects of the pandemic.

The US has left behind the economic effects of the pandemic since 2021. In the year of the downturn, US GDP shrank by -3.4 percent. However, since those days of 2020, the political decision has been to help its citizens cope with the crisis and the government has supported its residents with resources.

The result of not leaving people adrift was that the US GDP last year, with all the strength of the economy, managed to grow by 5.7%, which not only left behind the stagnation of the previous year, but also strengthened its economy.

On the other hand, Mexico reached the epidemic in recession, worsening to -8.2% of the GDP collapse during 2020, without any kind of support for anyone, and the recovery in 2021 was only 4.8%.

So, the US delivered a negative result for its economy during the first half of 2022, but it is far from a recession. We will see what happens next year when the restrictive monetary measures used to contain high inflation will have an impact on economic performance.

Meanwhile, Mexico had a very low growth first semester, subject to confirmation by data published today by Inegi, but our economy is stagnant and will continue to be at least for the remainder of this semester for six years with everything improving. In this year’s economic forecast.

We will have to see the domestic effects of US restrictive monetary policy and monetary policy at the hands of the Bank of Mexico.

All in one case of these mornings they are assuming that Mexico is growing and the United States is stagnating. Because that’s how they spend it.

distant neighbors

stagnant

Mexico had a first semester in 2022 with very low growth, subject to confirmation by data published today by Inegi, but our economy is stagnant.

Drops

The US delivered a negative result for its economy during the first half of 2022, but it is far from a recession.

recession

Mexico reached the epidemic in the recession, which worsened to an -8.2% collapse of GDP during 2020, without any kind of support for anyone.

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