Industrial production (IP) grew 2.8% YoY in November, below our forecast of 4.0% and market expectations of 4.9% (as per Bloomberg). Using calendar adjusted figures, IP expanded at the same pace, taking the quarterly annual rate of industrial production to 4.1% in November (from 4.5% in 3Q23). At the margin, IP fell by 1.0% mom/sa in November, dragged by soft manufacturing output (-0.5%), while construction fell by 2.9% (reflecting the culmination of AMLO’s large infrastructure projects that had boosted construction throughout the year). Sequential industrial production momentum softened, as reflected by the qoq/saar of 1.7% in November (from 5.4% in 3Q23), with manufacturing and construction at 2.7% and 0.2%, respectively.
Our take: Our GDP growth forecast for 2023 stands at 3.4%. For 2024 we forecast GDP growth of 2.8% supported by an expansionary fiscal stance which should mitigate the effects of an expected deceleration of the U.S. economy. Benefits from nearshoring may also be a more relevant driver for the economy this year.
See detailed data below
