Mexico’s economy crashed after a weak third quarter in October

MEXICO CITY (Reuters) – Mexico’s economy fell sharply by 0.2% in October compared to the previous month, following the country’s worst recovery in the fourth quarter due to the COVID-19 pandemic, official data showed on Friday.

The contraction adjusted for the October seasons was the third consecutive month-on-month decline in economic activity, according to data from the national statistics agency INEGI.

A survey by Reuters analysts predicted that the economy would grow by 0.8% in October, after gross domestic product (GDP) fell 0.4% after a disappointing third quarter.

Compared to the same month last year, the economy grew by 0.3% in October, in seasonally adjusted terms. In unadjusted terms, INEGI data fell by 0.7%.

Mexican business operations have been disrupted by bottlenecks in international supply chains, which have led to temporary work stoppages in industries such as automotive, a pillar of the country’s exports-driven manufacturing sector.

But the fragmentation of INEGI data showed that the contraction in October was a weakness of the third activities, which include services, and the primary activities, which include agriculture, fishing and mining.

Primary activities fell by 1.2% since September, while tertiary activities fell by 0.5%. On the other hand, secondary activities, including manufacturing, rose by 0.6%.