Wednesday 19 June 2013
Mexico.- Mexico’s rating shows the government’s history of applying cautious fiscal and monetary policies, which have contributed to keeping inflation and deficit low, have pushed its economic resistance and have kept foreign debt at bay. The rating also shows Mexico’s limited fiscal flexibility and modest economic growth perspectives in the medium term. Approximately 35% of total budgetary income comes from the petroleum sector, which leaves the government in a vulnerable situation due to the volatility in oil prices, while the non-petroleum revenue basis remains low.
The Mexican economy grew 3.96% in 2011 and domestic demand gained impulse, while net exports slowed down. We consider growth in 2012 will decelerate to 3%, in line with what happened upon closing last year and amidst global economic uncertainty. Therefore, we estimate growth rate will average 3.3% in coming years, which is low if compared to most of the other emerging markets.
Source: Kiosco Mayor
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