Uncertainty due to reform of the Judicial Branch will cause GDP to be less than 1%: BBVA

The economist pointed out in a press conference that there are three factors that are evidencing a slowdown in the Mexican economy.

“There is no doubt: Mexico’s economy is slowing down very noticeably,” said the economist.

For the specialist, there is three reasons why the economy is slowing down: a lower fixed investment by the government due to lower spending on flagship projects such as the Maya Train and the Dos Bocas refinery, as well as a certain weakness in private investment derived from the uncertainty that the judicial reform has brought.

The weakness in public and private investment is also reflected in a labor market that, although it continues to create jobs, is creating them at a slower rate than in previous years.

“The unemployment rate in Mexico is relatively low, in fact it is below the historical average of 2.7%. In general in Mexico there are not very high unemployment rates, why? Well because there is an informal sector that absorbs the losses of formal jobs,” he said.

The second point that has influenced the slowdown of the Mexican economy is due to less dynamism in manufacturing in the United States, which has infected Mexican manufacturing. And thirdly, a restrictive monetary stance.