Mexico's economy could grow 2% in 2023, says finance ministry official

BY Reuters | ECONOMIC | 12/07/22 09:00 AM EST

MEXICO CITY, Dec 7 (Reuters) - Mexican gross domestic product (GDP) could grow by 2% in 2023, Rodrigo Mariscal, chief economist and head of the economic planning unit of the finance ministry, said in an interview published on Wednesday.

Growth would be helped by employment and external factors such as the resilience of the U.S. economy, the official said in a podcast with Mexico's Grupo Financiero Banorte.

Analysts

surveyed by the country's central bank

last month forecast that Mexico's economic growth could reach 0.95% in 2023, after hitting 2.8% this year.

Mariscal said the economy would be boosted by public spending, which he forecast would reach 3.6% of GDP in 2023. The government has been increasing it since 2019, when it was at 2.3%.

"There is an effort on the part of the public sector to increase the productive capacity of the economy," he said.

Nearshoring, or the relocation of factories from overseas to a place closer to the final point of sale, could also help Mexico by creating job posts, boost exports and increase investments in different parts of the country, Mariscal noted.

Mexico has benefited from a push from the United States to relocate company factories from Asia to North America, even as Chinese firms boost their investments in the country. (Reporting by Valentine Hilaire; Editing by Sarah Morland)

In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

fir_news_article