Bank of Mexico slashes growth forecasts due to oil price crash

Mexico has struggled to emerge from a three-decade growth rut with GDP expansion averaging in the mid 2 per cent range.
Mexico has struggled to emerge from a three-decade growth rut with GDP expansion averaging in the mid 2 per cent range.

By Jude Webber / Financial Times

Mexico was supposed to have been one of the crude producing countries best able to weather the oil price shock because of its strong manufacturing sector and close export ties to the recovering US economy.

Yet those hopes have proved short lived. After announcing GDP growth of around 2.1 percent in 2014, the Bank of Mexico has slashed its forecast for this year to between 2.5 percent and 3.5 percent, down from its earlier estimate of 3 to 4 percent, due to lower oil prices and domestic consumption, it says.

The cut is just the latest in a slide of official forecasts underscoring a disappointing economic performance in stark contrast to the high growth promised by President Enrique Peña Nieto.

http://www.ft.com/intl/cms/s/0/ce481300-b7b5-11e4-981d-00144feab7de.html#axzz3SCuePceb

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