Specialists from the private sector consulted by Mexico’s Central Bank (Banxico) adjusted in February the economic forecast for the last three years of the current administration.
According to the latest Banxico survey, the economic forecast for Mexico in 2016 fell to 2,69 percent to 2.45 percentage points, while the Gross Domestic Product (GDP) forecast for 2017 and 2018 fell in both years by 3.18 and 3.42 respectively to 2.98 and 3.27.
The forecasts were shared on social media throughout the day.
Expectativa crecimiento del PIB en 2016, especialistas del sector privado: 2.45% (media), 2.49% (mediana), https://t.co/XTTGtDOIgR
— Banco de México (@Banxico) March 2, 2016
Likewise, according to the second Survey on Forecasts from Economist Specialists of the Private Sector of this year, the experts pointed to a greater weakness of the Mexican currency in this year and the next, due to changing forecasts in the exchange rate from yearly predictions of 17.60 and 17.17 peso per dollar to and increased 17.89 and 17.43 for the next years.
Annual inflation forecasts were also adjusted for 2016, rising 3.34 percent from the 3.10 predicted last January.
Analysts kept on mentioning, as in former Banxico surveys, the weakness of the external market and world economy, the international financial instability and the price of oil exports as the main risks to the country’s expected economic growth.
BANCOMER ALSO PESSIMISTIC
Mexico will grow less in 2016, reaching only 2.2 percent, 0.3 less than last year, according to bank BBVA Bancomer.
Due to greater internal and external risks in the last months, such as the the fall in oil prices, China’s slower growth and budget cuts recently announced by the Treasury and Public Finance Secretariat, the financial group chose reduce its forecast from 2.5 percent to 2.2 for the present cycle.
Javier Morales, an economist from the banking institution, indicated that an economic slowdown was foreseeable in the year’s first trimester, with an uplift in the second semester at the earliest.
He pointed out that although private consumption will continue to be the pillar of the economy, supplying 70 percent of the GDP, it will be more moderate during the year.
“We expect the impulse in consumption to continue during 2016, although in a lesser degree, spurred by the increase in real wage, which will make the GDP reach positive rates of growth.”
-Javier Morales. BBVA Bancomer specialist.
Despite the country’s performance being similar to the last cycle it will be far from its potential, which will be undermined by cuts reaching 132 billion pesos in the 2016 budget.
2017 could see the GDP to bounce back to 2.6 units, specialists said.
VIANEY PICHARDO AND OMAR SÁNCHEZ