Mexico: Manufacturing PMIs show mixed results in October but conditions remain subdued
The seasonally-adjusted manufacturing Purchasing Managers’ Index (PMI) produced by the Mexican Institute of Financial Executives (IMEF) dipped from 48.1 points in September to 46.7 points in October, marking the lowest reading since April 2017. Thus, the index fell further below the 50.0-point threshold, signaling a sharper contraction in the manufacturing sector compared to September. Notably, production, new orders and, in particular, employment contracted at sharper rates in October, driving the indicator’s downturn.
In contrast, the manufacturing PMI produced by IHS Markit climbed from 49.1 in September to 50.4 in October, the first time in six months that the index lands above the 50-threshold, indicating an expansion in manufacturing activity. October’s upturn largely reflected an increase in new orders as goods producers secured new projects, which in turn prompted them to lift staffing levels for the first time in eight months. Business confidence also strengthened on the back of firms’ improved outlook over sales growth and economic conditions.
According to the LatinFocus Consensus Forecast panel, industrial output will increase -% in 2020. Our panel sees industrial output increasing -% in 2021.