Mexico economy grows 1.0% in Q1, in line with projections

Economists had dubbed the preliminary first quarter data as "solid," but noted that a slowdown in the U.S. economy and a tight monetary policy would probably soften Mexico's performance in the coming quarters. The quarterly growth, according to the agency, was driven by a 1.5% jump in the tertiary or service sector and a 0.6% increase in secondary activities, which comprise manufacturing.

Mexico's economy grew 1.0% in the first quarter from the previous three-month period, national statistics agency INEGI said on Friday, matching forecasts from economists in a Reuters poll.

The figures came in slightly below preliminary estimates disclosed by INEGI a month ago, when the statistics agency said gross domestic product (GDP) had likely increased 1.1% in the period on a sequential basis. Economists had dubbed the preliminary first quarter data as "solid," but noted that a slowdown in the U.S. economy and a tight monetary policy would probably soften Mexico's performance in the coming quarters.

The quarterly growth, according to the agency, was driven by a 1.5% jump in the tertiary or service sector and a 0.6% increase in secondary activities, which comprise manufacturing. Primary activities such as farming, forestry, fishing and mining, nonetheless, shrunk by 2.8%.

In annual terms, INEGI added, the economy expanded 3.7% in the first three months of 2023 compared to a year earlier. That was slightly below the 3.9% growth expected by the market and projected by last month's preliminary data.

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