{"id":116747,"date":"2021-06-18T19:43:33","date_gmt":"2021-06-18T19:43:33","guid":{"rendered":"https:\/\/fin2me.com\/?p=116747"},"modified":"2021-06-18T19:43:33","modified_gmt":"2021-06-18T19:43:33","slug":"mexicos-president-sees-faster-return-to-pre-pandemic-economy","status":"publish","type":"post","link":"https:\/\/fin2me.com\/markets\/mexicos-president-sees-faster-return-to-pre-pandemic-economy\/","title":{"rendered":"Mexico's president sees faster return to pre-pandemic economy"},"content":{"rendered":"
MEXICO CITY (Reuters) -Mexico\u2019s President Andres Manuel Lopez Obrador said on Friday he expects that by the third quarter the Mexican economy will reach pre-pandemic levels, after gross domestic product contracted by some 8.5% last year driven by pandemic-related fallout.<\/p> The president\u2019s faith in a faster rebound is more optimistic than the central bank\u2019s latest forecasts.<\/p>\n \u201cWithout a doubt, by the third quarter of this year we will already be (at the levels) we were at before the pandemic,\u201d Lopez Obrador told a news conference.<\/p>\n Mexico\u2019s economy grew 24.8% in May compared with the same month last year, as a recovery from a slump made worse by the coronavirus pandemic gathered pace, a preliminary estimate published by national statistics agency INEGI showed on Thursday.<\/p>\n If the preliminary estimate is confirmed, May\u2019s activity was only about 0.4% behind the level reached in February 2020, the last full month before pandemic restrictions began to hit the economy, according to an index compiled by INEGI.<\/p>\n A continued, yet gradual, easing of coronavirus-related restrictions that began in late January has helped Mexico\u2019s economy, said Marcos Casarin, chief LatAm economist for Oxford Economics.<\/p>\n \u201cThe reopening of the tourism sector, which could add a substantial 15% of GDP in Mexico, has also happened sooner than we expected, which has helped to revive the struggling services sector,\u201d Casarin added.<\/p>\n But according to Mexico\u2019s central bank, only if economic growth this year can approach 7% will the economy recover to its pre-pandemic level from the end of 2019, and not until the fourth quarter of this year.<\/p>\n The bank added that if 2021 growth comes in closer to 6%, recovery to the pre-pandemic level would likely be delayed until the second quarter of 2022 or even later.<\/p>\n Goldman Sachs economist Alberto Ramos forecast Mexico\u2019s GDP growth would firm to 6.0% in 2021, \u201cwith risk skewed towards a higher print.\u201d<\/p>\n Ramos based his forecast on the strong performance of the economy in fourth quarter, additional expansion in the first quarter and expectations for a \u201cgradual but steady progress on the COVID vaccination front and strong external demand for the remainder of 2021.\u201d<\/p>\n