Mexico has a 60% chance of experiencing a recession

Mexico City. – The country has a 60 percent chance of experiencing a “moderate” recession in the second half of this year, when the United States is also expected to experience a recession, according to Franklin Templeton Mexico, an investment fund operator.

“There is a possibility of a slight recession in the second half of the year,” said Luis Gonzalez, vice president and co-director of investments for the operator.

He stressed that the economy of the neighboring country is still recording strong variables such as consumption and employment, but it has begun to deteriorate.

“It is deteriorating, and therefore we can start to see a recession, as they say, as early as the third quarter of this year, that is, in July, August and September, we will see the beginning of a recession,” he said.

He stated in a webinar that as a result of this slight recession, this year the country’s economy will grow by 1.5 percent, while inflation will be 6 percent.

He stressed that the Ministry of Finance’s estimate of economic growth of 3 percent this year is optimistic about what analysts expect.

On the other hand, he mentioned that Franklin Templeton estimates that the United States Federal Reserve (Fed) and the Bank of Mexico (Banxico) will reach the end of the rate hike cycle in May with an increase of 25 basis points in both. cases.

“We are not seeing interest rate cuts for the rest of the year, but rather the end of the bullish cycle as early as May (the month in which both central banks will hold monetary policy meetings) and the rest of the year to keep them at terminal levels,” he said.

See also  Robot Dogs: New cops with artificial intelligence patrol the streets of New York

He indicated that with this, the interest rate for the Fed will be at 5.25 percent and the interest rate for Banxico at 11.50 percent.

He explained that in the case of Banxico, core inflation is currently the main concern, as it remains at high levels, especially services.

Myrtle Frost

"Reader. Evil problem solver. Typical analyst. Unapologetic internet ninja."

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top