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Economic report
May 2007
I.
(Figure 1)
REAL SECTOR
Real Gross Domestic Product
(Annual percent change)
• The Mexican economy grew in the first
quarter
The Mexico’s Gross Domestic Product (GDP)
grew up 2.6% real in the first quarter of 2007
with respect to the same quarter of 2006.
Seasonally adjusted rates displayed a 0.16%
rise in the first quarter of 2007 from the
previous quarter. (INEGI)
Source: INEGI
• Industrial production rose in March
Industrial production rose 0.2% real from
March 2006 to March 2007, a cumulated
grow of 0.6% in the first quarter of 2007.
Mining rose 1.5%, construction 1% and
utilities 5.1%, all at annual rates; while
manufacturing output decreased 0.5%.
Seasonally adjusted rates displayed a
decline in industrial production of -0.23% in
March from February. (INEGI)
• Wholesale and retail sales increased
during March 2007
The wholesales, employment and real
average earnings increased 4.5%, 0.8% and
3.6%, in that order, from March 2006 to
March 2007. Retail sales and employment,
rose 2.8% and 2%, real average earnings
decreased 2%, in March 2007 with respect to
the same period of 2006. (INEGI)
• Unemployment rate rose slightly in April
2007
Unemployment rate reached 3.6% in April
2007, a higher level compared to the 3.32%
of the April 2006. By sex, the men’s
unemployment rate rose from 2.95% to
3.35%, while women’s unemployment rate
increased from 3.93% to 3.99%. Seasonally
adjusted rates displayed an unemployment
rate of 3.74% a rise of 0.2% in April of 2007
with respect to previous month. (INEGI)
(Figure 2)
Industrial production
(Annual percent change, 6-month moving average)
Source: INEGI
(Figure 3)
Retail Trade
March of each year
(Annual percent change)
Source: INEGI
(Figure 4)
Unemployment rate
April of each year
(Percentage of Economically Active Population)
Source: INEGI
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Economic report
May 2007
(Figure 5)
Total workers in the IMSS
• The employment rose in April 2007
The number of permanent and eventual
urban workers affiliated to the Public Social
Security Institution (IMSS) increased by 48,827
at April 30, 2007, to reach 14,270,662.
Between April 30, 2006 and April 30, 2007
total employment increased by 843,637, an
increase of 6.3%. In the first four months has
added 305,000 jobs. (STPS)
II. FINANCIAL SECTOR
(January 1 April 30, each year)
Source: STPS
(Figure 6)
• The consumer price index descending in
April 2007
The inflation reached -0.06% in April 2007,
according to the Mexican Central Bank. The
annual inflation in April was 3.99%, 0.22 lower
than in March. The cumulated inflation in the
first four months of 2007 was 0.96%. Core
inflation and no-core inflation reached
0.20% and -0.60% in April 2007. In annual
terms these price indexes rose 3.66% and
4.67%, in that order. (Banxico)
Annual Inflation
(Annual percent change, CPI, core inflation and no-core-inflation)
Source: Banxico
(Figure 7)
• Decreased the interest rate of Mexican
Treasury Bills (Cetes) 28 days
The Mexican Treasury Bills yields (Cetes
yields) with maturity of 28, 91 and 175 days
fell 2, 11 and 14 base points in the May 29,
2007 primary market auction to reach 7.22%,
7.36% and 7.47%, respectively. The Bondes D
keeps in 0.12%. The 5 years Government
Bond interest rate and 10 years Udibonos
rate decreased each one 9 base points, to
reach 7.59%, and 3.52%, respectively.
(Banxico)
Primary market auction: Cetes 28 days
Weekly auctions
Source: Banxico
(Figure 8)
Exchange rate peso/dollar
2006-2007
• The exchange rate displayed a slightly
decreased
The Mexican peso exchange rate reached
10.7189 pesos per dollar (ppd) in June 1st,
reflecting a 7.05 cents fell from the previous
Friday level. During 2007 the exchange rate
has averaged 10.9687 ppd, displaying a
depreciation of 8.29 cents. (Infosel)
Source: Infosel
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Economic report
May 2007
(Figure 9)
• Mexico’s country risk showed a slightly
decrease
Mexico’s country risk, measure by J.P.
Morgan’s EMBI+ Index, decreased 7 base
points (bp) in June 1 with respect to the
previous week, reaching 70 bp. On the other
hand, Argentina’s country risk fell 2 pb,
reaching 269 bp, and Brazil’s country risk
decreased 1 bp to locate at 139 pb. (JP
Morgan e Infosel)
Country risk
2006-2007
Source: EMBI+, J.P. Morgan e Infosel
(Figure 10)
International Reserves
• International reserves rose
Mexico’s international reserves rose by 143
million dollars (md) in May 25, 2007 with
respect to their level at May 18, 2007,
reaching
69,632
md.
During
2007
international reserves have raised 1,953 md.
(Banxico)
• The Mexican stock market close with a
landmark
The Mexican Stock Market Index (IPyC) rose
4.06% in June 1, reaching 31,946.4 points a
landmark. The IPyC showed a cumulated
profit of 20.79% in Mexican pesos and 21.9%
in US dollars with respect to the end of 2006.
(BMV)
At the end of each year, Billions of Dollars
*/ May 25.
Source: Banxico
(Figure 11)
Mexican Stock Market Index
Points
III. PUBLIC FINANCES
•A surplus is reaching in the first four months
of 2007
The public finances reached a surplus of
138.1 (mmp) during the first four months of
2007, higher than the balance of 51.6 mmp
in same period of 2006. The primary balance
reached a cumulated surplus to April of
206.1 mmp, 39.1% more than 2006. The
revenues reach 828 mmp, 5.4% real higher
than the same period of 2006, while the
expenses decreased 0.6% reaching 687.7
mmp. (SHCP)
Source: BMV
(Gráfica 12)
Public Balance
January-April of each year
Source: SHCP
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Economic report
May 2007
(Figure 13)
Trade Balance
IV. EXTERNAL SECTOR
• Grew deficit of trade balance during April
2007
The trade balance deficit reached 728
million dollars (md) in April 2007 according to
opportune information.
In the first four
months of 2007 the cumulated trade deficit
reached 3,368 md. Total exports attained
21,129 md, 6.9% higher than in the same
period 2006. Non-oil exports increased
10.8%, and oil exports decreased 11.1%.
Imports rose 12.1%, to reach 21,857 md.
(INEGI)
• The current account balance registered a
deficit in the first quarter of 2007
The current account balance displayed a
deficit of 2,758 md in the first quarter of 2007.
This figure was below in 873 md from the
registered in first quarter 2006. This deficit
was the result of a decreased of the
petroleum trade and motor vehicle trade
surplus. Banxico
April of each Year (million dollars)
Source: INEGI
(Figure 14)
Current Account
Billions of Dollars
Source: Banxico
(Figure 15)
Foreign Direct Investment
• The FDI flows rose solid in the first quarter of
2007
The Foreign Direct Investment (FDI) attracted
by Mexico reached 6,554 md in the first
quarter of 2007, 66.4% higher than the level
observed in the same quarter of 2006.
(Banxico)
• Oil prices were mixed
The price of the Mexican oil mix was 57.65
dollars per barrel (dpb) at June 1st, rising
0.26% from the level of May 25; the futures
for July for West Texas Intermediate (WTI)
and Brent in the derivatives market were
65.08 and 68.97 dpb, respectively, declining
0.18% and 2.42% from the May 25 figures.
During 2007 the price of Mexican oil mix
reached a cumulated variation of 18.48%
and an average level of 50.33 dpb. (Pemex
and Infosel)
January-March of each year
Billions of Dollars
Source: Banxico
(Figure 16)
Oli Prices
Dollars per barrel, 2006-2007
*/Futures.
Source: Pemex and Infosel
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Economic report
May 2007
V. OUTLOOK
• A 3.3 percent, core inflation in 2007 is expected
Banamex Citi.- Annalists from Banamex-Citi said due to stronger peso and relative weakness in
consume the annual core inflation will be at 3.3% at the end of 2007, descending from actual
3.7%.
• The Mexican economy will grow near 3.4% in 2007
Banamex Citi.- Annalists from Banamex-Citi said the data from the Global Indicator for Economic
Activity (IGAE) confirmed a slowing in the Mexican economy in March; higher than the
expected. According to annalists the difference is due to the expectative have been
incorporated the GDP data form the first quarter, 2.65 annual; however the IGAE grow 2.45%. The
figures doesn’t change the 2007 Banamex-Citi projects of 3.4% grow.
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