The weakness in Mexico's manufacturing industry, which contributes 20 percent of Mexico's GDP ($1.86 trillion), will extend to the second half of the year and will last until next year, predicted the Spanish bank BBVA.
"We anticipate that the weakness in manufacturing will extend to the second half of the year, in line with the lower growth in external demand (mainly from the United States). Production will gradually recover in 2025, in a scenario of lower interest rates and reestablishment of household spending patterns," wrote BBVA Research chief economist Saidé Salazar.
The economist said that according to Inegi data, in accumulated terms the manufacturing industry registered a decrease of 0.5 percent. This is because 11 of 21 subsectors recorded production levels below those recorded last January and of them "the basic metal industry stands out, with a production level 12.5 percent below the level recorded in January 2024."
The manufacturing industry in Mexico is the largest generator of formal employment in the country and contributes 89 percent of the value of the country's total exports.
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