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Mexico: Weak industrial production numbers - Wells Fargo

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 11, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Córdoba) - According to analysts from Wells Fargo, the latest numbers of Mexican industrial production shows weakens across the board and the construction sector, that had been a contributor, tanked in November.

    Key Quotes:

    “The Mexican industrial production index dropped 0.5 percent in November versus market expectation of a 0.3 percent increase. Construction, which had been contributing to the index lately, tanked in November.”

    “Construction activity in Mexico dropped 1.4 percent in November compared to October, the largest monthly drop since a 2.5 percent decline in May 2015. (…) The sector’s momentum has softened and thus will continue to act as a drag on the overall industrial production index. This was the weakest year-over-year reading for this sector since this sector came out of recession back in May 2014.”

    “The industrial production index has been weak overall. However, sectors that were weak but at least adding to the index have changed their tone and are now not contributing as they were before, which is making the overall index even weaker than it has been.”

    “On a year-over-year basis, not seasonally adjusted, output in the overall Mexican industrial sector was up only 0.1 percent. With only one month more of data still to come for 2015 for the industrial production index, the year is probably going to end up close to 1.0 percent above the level it recorded in 2014, a very weak performance by any standard. This compares to a relatively strong 2.6 percent growth rate in full-year 2014, which was driven by two very strong sectors, manufacturing production (i.e., automobile production) and construction.”
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