The Mexican economy grew by 1.1 per cent in 2013, its slowest rate since the 2009 recession and well short of the 3.5 per cent that President Enrique Peña Nieto initially expected during his first year in office.
In the fourth quarter, GDP expanded 0.2 per cent seasonally adjusted, due to slower growth in industrial sectors. The pace of expansion was significantly below market expectations for 0.6 per cent growth, leading to concerns over the health of the North American economy. Barclays Capital said the weak growth was probably the result of slow US imports and a “still fragile domestic consumer”. Continue reading »
The Mexican economy may have avoided falling into recession when it bounced back in the third quarter, growing slightly more than expected.
Yet, so far, there are few signs of a real improvement.
On Monday, the Auto Industry Association reported that the country’s light vehicle exports, which had been growing in low double-digit numbers, had returned to their sluggish performance of the second quarter. Continue reading »
With very little to brag about so far in economic terms, the one-year-old government of Enrique Peña Nieto, president of Mexico, is betting on a banner year in 2014.
Having learnt a tough lesson on the crucial role that government spending, particularly on infrastructure projects, plays in Mexico’s economic performance, the government is not just trying to avoid this year’s budget delays — it is already moving on with assigning projects that are scheduled to start in 2014.
At least it is doing so with Tuesday’s planned announcement of 15bn pesos (US$1.15bn) worth of public work projects it plans to assign through public bidding processes.
As a result, the authorities are hoping that by announcing these new projects as early as Tuesday, they’ll be ready to allocate them in the first weeks of January so that the winners can start their construction by late next month or early February. Continue reading »
As soon as Ben Bernanke mentioned in late may that the Federal Reserve could soon begin to scale back its bond-buying programmed, hell broke loose in emerging markets.
Stock prices declined, currencies fell and interest rates on sovereign or corporate bonds shot up. For many investors, Bernanke’s comments on May 22 in testimony before the US Congress meant that the easy flows of money that had landed in emerging economies would not only end soon, but worse — would be reversed.
As a result, many financial markets in emerging economies began experiencing some “withdrawal symptoms” even before the Fed had acted.
Press forward. By September, the Fed hadn’t touched its bond-buying programme and suggested instead that it wouldn’t any time soon. Most economists and fund managers by then had figured that the famous tapering would not take place until at least December. Continue reading »
After a disappointing year, the Mexican economy seems to have turned the corner.
At least that’s what the third-quarter GDP numbers show. For starters, its annual growth rate of 1.3 per cent exceeded expectations of a 1 percent growth rate, and its quarter-to-quarter seasonally adjusted number came in positive (o.8 percent), ending all speculations that Mexico would fall into recession.
The economy actually contracted 0.6 percent in the second quarter, an unexpected event for a country that was expected to continue its growth momentum of the past three years. Continue reading »
The great expectations that Mexico’s largest dairy company, Grupo Lala, generated when it said it would go public three weeks ago, were not exaggerated.
On its debut on the Mexican stock exchange on Wednesday, the company’s shares rose 7.6 per cent to close at 29.59 pesos, reflecting the great appetite the company had generated among investors because of its track record and growth prospects. Continue reading »
The so-called Mexican Moment might have lost some of its steam because of the country’s slowing growth prospects, but the country’s equity market has never had it so good.
Even as companies in Brazil and elsewhere in the emerging market world have shelved plans to raise money following this summer’s turmoil, Mexican companies have continued to come to the market. Continue reading »
It has been a long, long time – since 1999 to be precise – since Wal-Mart de México has turned in such a poor performance.
Walmex, as Walmart’s Mexican arm is known, reported a 4.7 per cent drop in same-store sales in September, the biggest monthly sales decline recorded in 14 years. Continue reading »
Grupo Lala, Mexico largest milk producer, plans to sell shares in Mexico and abroad in the first initial public offering of a dairy company in the country.
The company didn’t disclose the size of its offering, but Bloomberg, citing two unnamed sources with direct knowledge of the transaction, said Grupo Lala would seek to raise at least US$700m Continue reading »
The company behind the world’s biggest Coca-Cola bottler, not content with running Mexico’s leading chain of convenience stores and pharmacies, has announced plans to add yet another new business to its stable: fast-food restaurants.
Fomento Económico Mexicano (Femsa) on Monday said it planned to acquire an 80 per cent stake in Gorditas Doña Tota, a well known restaurant chain in northern Mexico. Continue reading »
If Mexican bottlers are upset about a proposal to levy a new tax on their widely consumed sugary drinks, auto companies are furious at several tax changes that Mexican President Enrique Peña Nieto proposed two week ago.
In their case, car, truck and auto-part makers claimed recently that the fiscal changes will damage their production and job-creating activities, at a time when the Mexican auto sector has become a pillar of the country’s manufacturing prowess. Continue reading »
Nearly three months after putting its restaurant chain, Vips, up for sale, Wal-Mart de México y Centroamérica has finally found a taker: Alsea, Mexico’s largest fast and casual-restaurant operator, as well as the sole owner of all Starbucks coffee shops in the country.
The price tag for the 362-oulet chain? 8.2bn pesos ($627m). Continue reading »
For Mexico’s car industry, 2013 has been, up to now, a somber and uneventful year. Sales of Mexican-made vehicles abroad registered a 2.1 per cent decline in the first seven months of the year compared with the same period a year before.
But there are reasons to think things could be looking up – thanks to the US, Canada and several Latin American countries. Continue reading »
Two months into the third quarter and Wal-Mart de México, the US retailer’s Mexican arm, has very little to cheer about – at least in terms of luring more higher-spending customers to its massive retail chain.
Last month, the company’s sales from stores that have been open for at least a year fell again, the second contraction in a row and the sixth decline so far this year, a clear reflection of the doldrums into which the Mexican economy has fallen. Continue reading »
Those hoping Mexico’s economy would start the second half of the year on better footing were left disappointed on Friday.
Industrial production in Latin America’s second largest economy fell 2.4 per cent in June compared to the same period the year before.
The year-on-year drop was larger than what any analysts had expected and even prompted JPMorgan to downgrade its growth outlook for the country this year to 2.4 per cent, down from its previous guidance of 2.8 per cent. Continue reading »