Gross Fixed Investment (GFI) fell by 3.3% YoY in September (vs market consensus of -0.5%), while private consumption rose by 1.0% (vs market consensus of +1.4%). According to the seasonally adjusted series, GFI fell by 0.8% MoM, driven by a drop of 0.4% in construction and 1.1% in machinery and equipment. GFI momentum almost stable at the margin, with the qoq/saar at 3.0% (from 2.6% in the quarter ending in August). Meanwhile, in seasonally adjusted terms, national consumption rose by 0.3% MoM (prior +0.3%), with +0.5% in goods and +0.2% in services. QoQ SAAR accelerated further to 3.8% (from 1.4% in the quarter ending in August).
Consumption’s fundamentals remain strong. October’s unemployment rate fell to 2.5% (prior 2.7%) in seasonally adjusted terms, well below the historical average. While consumption accelerates at the margin, investment keeps losing strength.
Our take: Our GDP growth forecast for this year stands at 1.4% and forecast a deceleration to 1.0% in 2025. While consumption fundamentals remain positive, there’s no more boost coming from investments, especially given a higher domestic risk premium and higher volatility/uncertainty after the US election.
See detailed data below
