Mexico’s economy grew more than expected in the second quarter as private consumption remains robust and the country benefits from strong exports to the US, its largest trading partner, Bloomberg News reported. Gross domestic product rose 0.9% from the previous three months, above the 0.8% median estimate of analysts surveyed by Bloomberg. From the same period a year ago, GDP grew 3.7%, more than economists’ 3.3% forecast, according to preliminary data released by Mexico’s national statistics institute Monday.
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Petroleos Mexicanos’s profits fell in the second quarter as the company struggles with soaring debt, Bloomberg News reported. Pemex also confirmed it received fresh funds from the government in a capital injection worth 64.97 billion peso ($3.9 billion), said Alberto Jimenez, associate managing director of finance at the company, on a conference call with investors on Friday. In total, support under Lopez Obrador has amounted to nearly $49 billion in capitalizations, tax breaks and other assistance. “The amount of the contribution for 64.97 billion pesos is confirmed,” he said.
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Mexico’s inflation extended its gradual slowdown in early July, roughly in line with forecasts, helped by double-digit interest rates and the strongest peso since 2015, Bloomberg News reported. Consumer prices rose 4.79% in the first half of the month compared to the same period a year earlier, down from 4.93% in late June, the national statistics institute reported Monday. The result was just above the 4.77% median estimate of economists surveyed by Bloomberg.
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Mexico has been hit with three sets of trade arbitration proceedings in the past few days, according to the International Centre for Settlement of Investment Disputes (ICSID), Reuters reported. First Majestic Silver and Silver Bull Resources, both Canadian companies, as well as U.S. food firm Arbor Confections have filed cases against Mexico, ICSID said in brief statements issued between Thursday and Friday. The proceedings all invoked the North American Free Trade Agreement (NAFTA) and the United States-Mexico-Canada Agreement (USMCA) which replaced NAFTA.
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Cineworld Group is looking at Eduardo Acuna, who runs the Americas operations of Mexico's Cinepolis, as a potential candidate to take the helm at the embattled British cinema chain operator when it emerges from bankruptcy proceedings, Sky News reported. It is not clear whether Acuna was formally in the frame to take the job or how quickly Cineworld's new owners were seeking to make an appointment, the report said.
The Bank of Mexico maintained its benchmark interest at 11.25% on Thursday for the second time, signaling it will hold the rate "for an extended period" as inflation in Latin America's second largest economy slows but remains above the bank's target, Reuters reported. The unanimous decision by the central bank's five-member board was in line with analysts' forecasts and came as data shows annual inflation at its lowest in more than two years.
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Bond investors in Credito Real SAB are crying foul after being left in the dark for more than a year in one of the largest corporate blowouts in Mexico’s recent history, Bloomberg News reported. After defaulting on $1.9 billion of dollar bonds in February 2022, the non-bank lender embarked on a liquidation process in a Mexico City court that bondholders say has been tilted against them. Now, lawyers are pushing for a deal that they say would allow creditors to recoup as much as 23 cents on the dollar.
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Mexican retail sales rose much more than expected in April, data from national statistics agency INEGI showed on Tuesday, pointing to a strong start to the second quarter despite tight financial conditions, Reuters reported. Sales rose 1.5% in the month from March, beating market expectations of a 0.2% increase in a Reuters poll, helped by a strengthening peso and falling inflation, which has been hovering its lowest in almost two years.
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Mexico's annual inflation rate slowed in May for a fourth consecutive month to 5.84%, data from statistics agency INEGI showed on Thursday, beating forecasts and continuing a downward trend spurred by a long cycle of rate hikes, Reuters reported. Headline inflation came in below a forecast of 5.90% and is now at its lowest since August 2021. Consumer prices fell 0.22% in May from April, according to non-seasonally adjusted figures, against an expected drop of 0.16%. Nonetheless analysts say future drops in inflation may now be trickier, prompting a delay in rate cuts.
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Analysts from Goldman Sachs & Co and XP Investimentos are betting a fresh bout of dollar weakness can fuel gains in the Mexican peso, the world’s best performing currency, Bloomberg reported. The bullish calls come after the currency — dubbed the “super peso” because of its astounding rally — gave up some of its gains amid political noise at home and a global selloff amid U.S. debt-ceiling talks. Despite recent losses, the peso is still up 9.5% against the dollar this year, the best major currency in the world in that span.