The Bank of Mexico (Banxico) revised down its growth forecast for this year, from 6.2% previously to 5.4%, according to the information in the Quarterly Report of the central institution for the third quarter of the year.
This review, explained the central bank, responded mainly to a performance of the Gross Domestic Product (GDP) below expectations in the third quarter of the year, which Alejandro Diaz de Leon, governor of Banxico, he explained, was due to the recrudescence of Covid-19 pandemic in the period, as well as the reform of outsourcing.
The risks that could lead to a downward revision of the estimate, explained the governor of Banxico, are a worsening of the pandemic that leads to new restrictive measures; bottlenecks are prolonged and input costs rise; episodes of volatility in financial markets, as well as a recovery in investment spending lower than expected.
With this, the estimate of Banxico it is below that of the government. The Secretariat of Finance and Public Credit (SHCP) has maintained its growth estimate at 6.3% for this year.
By 2022, the central bank improved its growth estimate. Previously, the GDP was expected to present an expansion of 3.0% the following year, but now Banxico sees a growth of 3.2%, which would decrease by 2023 to 2.7 percent.
For next year it is revised up to 3.2%, various elements within the internal demand that are expected to have greater dynamism the following year ”, said Díaz de León in his last presentation of the quarterly report.
Regarding inflation, for the last quarter of this year Banxico It increased its estimate from 5.7 to 6.8%, and it is expected to be until the third quarter of 2022 when prices converge to the institution’s goal of 3% +/- 1 percentage point.
Reference-www.eleconomista.com.mx