MexECON Blog

December Industrial Production Rises 0.9 Percent

Mexico's December industrial production rose by a seasonally-adjusted 0.9%, after a rise of 0.1% in November and a revised decline of 0.3% in October.  The increase in December was the strongest since a 1.5% jump in September.  The rise at the end of 2011 stemmed mostly from an expansion of 1.2% in manufacturing output.  Utility production rose 1.4%, and construction activity edged up 0.2%, but those subsectors are much smaller than manufacturing.  Mining activity fell 0.3% in December.  On an unadjusted basis, overall production in December was up 2.8% from the same month one year earlier.  For full-year 2011, Mexican industrial production was up 3.8%.  The report was released today by INEGI, the official statistics agency.

Comment:  The strong rise in industrial activity during December provides more evidence that the Mexican economy is gaining traction again, after a soft spot in late autumn and early winter.  Similarly, recent reports have shown a rebound in fixed investment in November and a surge in consumer confidence in January.  These improvements probably reflect the recent cooling of the European debt crisis and acceleration in U.S. economic activity.  With continued improvement in the U.S. economy and momentum in its own domestic demand, Mexico's economy will probably continue to grow at a good pace for a while yet.

Patrick Fearon, CFA
Vice President, Fund Management

                                          Mexican Industrial Production
                                         Seasonally Adjusted, 2003 = 100
                                                       Source:  INEGI
Industrial Output 1112

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