Exports drive Mexican growth rate

Mexico's industrial production improvement since last year largely has been driven by strengthening US growth and a jump in vehicle exports. Mexico's real export growth has surged impressively on average. The improvement in the competitiveness of exports - and, therefore, stronger investment growth - was achieved via lower wage growth in a weak labour market and should be helped by the weakening peso. 

A stronger manufacturing and trade gains is expected in H2 15, boosting the rest of the economy via the investment, employment, wage and sentiment channels. Improvement in IP growth through the  remainder of this year should help the economy grow to its potential in H2 15 and then to strengthen in 2016. Currently, the Mexican economy is likely to grow by 2.3% in 2015 and 3.1% in 2016.