Data released on Monday showed that Mexico's industrial production decreased 0.5% m/m in seasonally adjusted terms in November, missing forecasts. Compared to a year ago period, industrial production increased just 0.1%. Construction was the main drag, which fell 1.4% m/m sa, followed by mining -0.5% m/m sa, and manufacturing -0.4% m/m sa.
Weakness in mining and construction sector with a stagnant manufacturing activity is expected to continue in the coming months. A weaker global economy could keep dragging on activity and further add to 2016 growth risks for Mexico.
"We forecast that Mexico GDP proxy for that month will decrease 0.4% m/m sa, setting our Q4 GDP tracker at 0.0% q/q sa, below our Q4 GDP forecast of 0.4% q/q sa. This IP report sets downward pressures to our 2.5% GDP forecast for 2015, but the GDP proxy report should confirm it," said Barclays in a report.
