Q1 Positive Surprise: Mexico Economy

Good news from Mexico during Q1. GPD increase 4.5% on an annualized base and most importantly inflation fell for the third consecutive month in March.

The increase on GDP was mainly driven by the Service Sector which grew 4.8% while goods producing industries rose 2.8%.

Relating to exports, they increased 9.9% over the last 12 months.

Industrial Production increase 0.5% which is less than expected

Unfortunately Retail Sales are still very depressed, a trend that started during the year 2017

The positive news are represented by Inflation which is coming down from 5.3% in February to 5% in March.

This may reverse if the Peso will start depreciating against the dollar but so far this is not happening

So overall Mexico has not yet been heavily impacted by strength of the Dollar like other EM Currencies like the Brazilian Real, Turkish Lira and Argentinian Peso. However this may change during the next week. This may reverse the positive trend on Inflation which may start going up.