Mexico’s economy is facing a “high degree of uncertainty” because it is still difficult to predict the duration of the covid-19 pandemic and the impact that the virus containment measures will have, the Central Bank of Mexico (Banxico) said in a report on Wednesday, Aug. 26.
“The evolution of the covid-19 pandemic is still in progress both globally and nationally, so a high degree of uncertainty persists in any projection of economic activity in Mexico,” the bank stated in its inflation report for the second quarter.
In that report, Banxico readjusted its annual GDP projections for 2020 to a drop of 12.8 percent — it’s worst projection so far.
Previously, Banxico had predicted a contraction of 8.3 percent for 2020.
The Banxico report stated, however, that Mexico’s economy could grow between 1.3 percent and 5.6 percent in 2021.
Banxico also offered two more positive possible scenarios for 2020, one for a 11.3 percent contraction and another for an 8.8 shrinkage.
“It is necessary to emphasize that there is a prevailing risk that economic activity could present lower or higher trajectories than those described,” Banxico added.
“As more information becomes available on the dynamics of the pandemic itself and its effects on economic activity, it will be possible to determine what type of scenario will materialize,” it stated.
As of Wednesday, Aug. 26, Mexico had reported 62,076 deaths and 573,888 confirmed cases of covid-19 since the virus was first detected in the country on Feb. 28, according to the Mexican Health Secretariat, but most outside sources estimate that the real figures are considerably higher.
…Aug. 27, 2020