The upturn is driven by industrial production, with manufacturing taking the lead, fueled by exports to the United States. Construction has recently picked up as well, while mining is still faltering, due mainly to oil production, on the decline since 2004. Domestic spending has also improved somewhat, with private investment showing more strength, and consumption gains unable to obtain traction.
Analysts’ consensus forecasts for this year and next call for the economy to gradually pick up steam, pulled by positive U.S. performance.4 Downside risks to the growth outlook include continued stagnant consumer confidence, the potential impact of social unrest, and possible further reductions in the oil production platform. Mexican financial markets face two challenges.