Mexico's economy will grow 2.2% in 2018 due to the increase in trade with the United States.

Mexico's economy will grow 2.2% in 2018 due to the increase in trade with the United States.



The economy of Mexico will expand 2.2% in 2018, a figure slightly higher than that registered last year, mainly due to the increase in trade with the United States, according to a report released Thursday by the Economic Commission for Latin America and the Caribbean. the Caribbean (Cepal).

In addition, for the current year an inflation of 4.6% is expected, compared to 6.8% registered in 2017 and exceeding for the second consecutive year the target range of the central bank, between 2% and 4%.

It is also estimated that the unemployment rate will be 3.3%, slightly lower than in 2017, which reached 3.4% and that the fiscal deficit of the public sector will be around 2.0% of the Gross Domestic Producer (GDP). ), compared to 1.1% in 2017.

From January to October 2018, total exports increased at an annual rate of 11.5%, as a result of increases of 40.0% and 9.8% of oil exports (mainly due to a higher price) and non-oil, respectively.

Among non-oil exports, those destined for the United States, which account for 80.8% of total exports, grew at an annual rate of 8.8%, as a result of a better performance of that country's industrial sector and those destined for to the rest of the world at an annual rate of 14.2%.

The value of total imports grew by 11.6% in the same period, due to the expansion of oil imports (33.3%), while non-oil imports grew by 9.3%.

On the other hand, the trade balance showed an accumulated deficit of 13,159 million dollars in the first nine months of the year, 15.7% higher than the deficit for the same period of 2017, said the Preliminary Balance of ECLAC.

For 2019, an increase in GDP of 2.2% is expected, associated with a slight acceleration of public and private investment, and the increase in consumption as a result of higher real wages.

However, the report anticipates that there are risks that, if materialized, could lead to a slowdown in GDP growth, such as the change in international financial conditions due to an increase in interest rates in the United States, the financial uncertainty linked to the commercial tensions and the perception of investors about the direction of the new economic policies, among others.

For the next year it is expected that inflation in Mexico will be in a range of 3.9% and that the unemployment rate will reach 3.4%.

The fiscal deficit of the public sector would reach around 2.0% of GDP (with a primary surplus of 1.0% of GDP) and the deficit of the current account of the balance of payments would be equivalent to 2.3% of GDP. GDP at the end of 2019.

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