Economics: Construction boosts GDP growth in the third quarter, while manufacturing stagnates
Third quarter GDP data released Friday was closely in line with what Inegi estimated roughly a month earlier in the preliminary figures, with the economy growing an annual 3.3% and a cumulative 3.6% for the first nine months of the year. Growth continues to be driven, above all, by the construction sector. Civil engineering works accelerated their triple-digit gains of the previous quarter while most of the almost 8% rise in the building component was concentrated in its non-housing component as the housing industry remains flat according to gross fixed investment figures. The performance of the construction sector has been especially striking given the exponential growth figures being reported by Inegi and a lack of correspondence in public spending on infrastructure reported by the Ministry of Finance. In contrast, manufacturing remained stagnant (0.2% increase), largely due to the weakening of industrial production in the US that has affected non-automotive manufacturing, the sector that represents between 70 and 80% of the total.
Services activity has recently softened in contrast to the significant dynamism seen early in 2023, owing mostly to weakness in professional and financial services.
We have also witnessed a weakening of retail commerce compared to previous months, in keeping with other indicators of private consumption that have experienced a deceleration after clocking considerable growth early in 2023. However, we look for continuing consumption gains through the final weeks of 2023.
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