Industrial production (IP) rebounded to 2.9% YoY in January (from a null expansion in December), above our forecast and market consensus (as per Bloomberg) – both at 2.2%. IP was supported, in part, by a favorable calendar base effect. In fact, using calendar adjusted figures, IP expanded 1.8% yoy, taking the quarterly annual rate to 1.9% in January (from 3.0% in 4Q23). At the margin, IP expanded 0.4% MoM/SA driven by construction output (2.2%), while manufacturing expanded at a soft 0.2% MoM/SA. Construction output became once again the main driver of industrial production, which could be associated with the culmination of AMLO's large infrastructure projects. Momentum remained weak, with the qoq/saar at -4.0% in January (from -1.0% in 4Q23).
Our take: Our GDP growth forecast for this year stands at 2.8% supported by a frontloaded expansionary fiscal stance, and a still supportive external demand. The strong rebound in construction could be associated to frontloaded public capital expenditure in 1H24, before elections.
See detailed data below
