Mexico’s central bank cuts 2022 economic growth forecast

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The central bank of Mexico (Banxico) has cut its economic growth forecast for 2022, citing the persistent uncertainty resulting from the Covid-19 pandemic.

Banxico lowered the expected growth of the gross domestic product from 3.2 per cent to 2.4 per cent in its Quarterly Inflation Report for the October-December 2021 period, reports Xinhua news agency.

However, the central bank raised its growth forecast for 2023, from 2.7 per cent in its previous report to 2.9 per cent.

When presenting the report, Victoria Rodriguez, Governor of Banxico, said the 2022 review took into account the expectation of less fiscal and monetary stimuli in advanced economies, less mobility due to increasing Covid-19 cases and disruptions to supply chains.

“Although progress has been made in vaccination globally, an environment of high uncertainty persists regarding the evolution of the pandemic, as well as its effects on the economy and supply chains, which could continue to affect the performance of economic activity,” said Rodriguez, who took office on January 1.

Regarding inflation, the monetary authority maintained its forecast for 2022 at 4 per cent.

Mexico’s annual inflation in 2021 stood at 7.36 per cent, the highest level in more than two decades.

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