President of Bursamétrica
At the end of April, the INEGI published its preliminary estimate of the GDP for the first quarter, estimating a variation of +0.9 percent quarterly and an increase of 1.6 percent annually. If we already know the IGAE data for January (+1.8 percent per year) and February (+2.7 percent per year), the data we do not know is the IGAE for March. Which gives us an implicit estimate of around +0.4 percent per year for the IGAE for March, which coincides with the timely estimate of the IGAE for March in the INEGI’s Timely Indicator of Economic Activity (IOAE).
We have already commented that observing data from the domestic market such as the sales of the commercial chains affiliated with ANTAD for that month, with an increase in real terms of 1.26 percent per year, as well as the data on manufacturing exports, which in March increased to 19.9 percent per year in dollar terms, it is not clear why the estimated variation for the month is so low. The same was given by our IBAM leading indicator for March, with an estimate of +0.7 percent per year.
Now in April, the performance of the economy was not bad at all. With our IBEM indicator, the most timely of our three indicators, and with the figures provided by the IMCE of the IMCP / Bursametric for April, we see that the economy could have grown above 2.0 percent annually again, despite the strong contraction that seems to have the construction sector. If construction were to see slight growth instead of the contraction it appears to be experiencing, the economy could have grown close to 4.0 percent real annually in April.
• The Stock Market Index of the Mexican Economy / (IBEM) for the month of April was located based on original figures, (not seasonally adjusted) at 125.02 units vs. 131.90 points in March, with a decrease of 5.21 percent per month, equivalent to a variation of +3.01 percent per year, while in March, the variation was +16.12 percent per month and +8.88 percent compared to the same month of 2020. Preliminary data for April show improvement in the manufacturing sector, and revival in the domestic market.
The following factors favored the indicator:
• Sales of commercial chains affiliated with ANTAD to comparable stores grew by 6.05 percent real annual vs. +1.26 percent annual real from March.
• Automotive exports grew 2.86 percent annually in April, while in March they rose by +2.49 percent annually.
• The price of the Mexican mix of oil exports in terms of pesos, grew by 75.60 percent annually in April, while in March it rose by 55.10 percent annually.
• The Mexican Indicator of Economic Confidence of the Mexican Institute of Public Accountants / Bursametric in its current perception component observed an increase of 1.58 points, to 65.98 points from 64.4 points in March.
• The Mexican Economic Confidence Index (IMCP/Bursametric) in its sub-index of the perception of the future situation rose from 73.4 units in March to 77.2 units in April.
• The manufacturing IMEF indicator improved in April to 52.5 units compared to 51.9 points in March.
The factors that affected the indicator were:
• Automotive production decreased in April by 6.58 percent annually, while in March it rose by 0.80 percent annually.
• Domestic auto sales fell 0.98 percent annually in April; while in March they increased by 15.64 percent annually.
• The non-manufacturing IMEF indicator fell in April to 53.0 units from 53.6 points in March.
• The ISM Indicator of the American manufacturing sector fell from 58.3 in March to 57.1 units in April.
• The number of workers affiliated with the IMSS rose in April by 4.69 percent annually, while in March it increased by 4.89 percent annually.
• The Price and Quotation Index of the Mexican Stock Exchange has grown by +4.74 percent in the last 12 months, while in March it increased by +19.82 percent annually.
With the result of the “Bursametric Index of the Economy of Mexico” (IBEM) for April, we preliminarily estimate an increase in the IGAE for April of +2.04 percent annual real, (-1.93 percent monthly), under original figures (not seasonally adjusted) . If this estimate is correct, Mexico’s GDP could see an increase in the second quarter of 1.6 percent per year; GDP for the entire year 2022 we are estimating at a growth of 1.5 percent per year.
However, these numbers are telling us that we have not recovered from the effect of the pandemic, and that it is very likely that growth for the entire six-year period will be the lowest in history. We have a severe trust problem that inhibits productive investment. The opportunities before us are extraordinary: production of components for the clean energy industry, controlled production of cannabis and poppy for the drug industry, the production of auto parts to raise the regional integration component required by the T-MEC, the nearshoring, the development of the aerospace industry, the export of farm and agro-industrial products, etc. It is desperate that once again we let all these opportunities pass us by. There is already an important thinktank which suggests that we change the system and not just the government.