According to data published by INEGI this Friday, the Global Indicator of Economic Activity (IGAE) showed an annual growth of 0.9% and a monthly growth of 0.4%. This represents a positive change after the decline of 0.7% in October, which was the first decrease since 2021 and raised concerns about economic slowdown.
In November, economic activities surprised the market by defying estimates, especially driven by tertiary or service activities. These showed a monthly growth of 0.5% and an annual growth of 2%, setting the pace for the domestic market. On the other hand, secondary or industrial activities advanced by 0.4% monthly, highlighting the recovery in manufacturing although construction saw a decline, likely related to the completion of government infrastructure projects.
In contrast, primary or agricultural activities decreased by 1.4% compared to October, but grew by 1.1% compared to November 2023. Despite these advances, there is a clear economic slowdown, deviating from the forecasts of the Ministry of Finance and Public Credit (SHCP), which estimated GDP growth between 2.5 and 3.5% for 2024.
As of November, economic growth barely reaches 1.6%, compared to the 3.6% growth in the same period of 2023, evidencing a weakening of economic activity compared to the previous year. Expectations suggest a December with low economic growth, similar to what was observed in employment data that reflected a decrease in the creation of new jobs.
In this context, special attention is given to the component of secondary activities, which accumulated 3 months of contraction in the annual variation, highlighting the fragility in the construction sector. Economic growth at the end of the year is estimated to be around 1.5%, half of what was projected by the Ministry of Finance, indicating performance below expectations for 2024.
After two years of growth exceeding market projections, the economy in 2024 is set to close well below the expectations of the SHCP, mainly due to the poor results in the last quarter. This data will be confirmed at the end of January by INEGI and according to Banamex's interpretation, the month of December will also reflect an economic contraction.
