Macro Analysis /

Mexico: Ahead of the Curve

  • Attention on INEGI’s Timely Indicator of Economic Activity, expecting a downward revision for September on worse signals

  • However, October’s print could show a rebound, consistent with more positive data

  • Markets closed on Monday in remembrance of the Anniversary of the Revolution

Juan Carlos Alderete Macal
Juan Carlos Alderete Macal

Director of Economic Research

Francisco Jose Flores Serrano
Francisco Jose Flores Serrano

Senior Economist, Mexico

12 November 2021
Published byBanorte

Possible economic rebound at the start of 4Q21

Weekly international reserves report. Last week, net international reserves rose by US$69 million, closing at US$198.9 billion. According to Banxico’s report, this was explained by a positive valuation effect in institutional assets. So far this year, the central bank’s international reserves have increased by US$3.3 billion.

Timely Indicator of Economic Activity (October). This release will include the first estimate for October, as well as revised figures for September. We recall that August’s mid-point forecast was at 6.2% y/y (using sa figures), much higher than the 3.8% in the GDP-proxy (IGAE). September’s estimate, currently at 5.0%, will likely be revised lower, especially considering industrial production and the advanced 3Q21 GDP, which disappointed lower. Specifically, it is likely that there was a sequential decline in activity. For October, signals have been more positive. Virus conditions kept improving, driving mobility higher. This is also consistent with better dynamics in timelier data, such as IMEF’s PMIs. Given this and a more favorable base effect, we could see a sequential rebound in activity.