Since the economy of the country already added three consecutive quarters with contraction, unofficially, it entered into a technical recession
After the Inegi announced that the country’s economy contracted at 0.08 percent during the fourth quarter of 2018 at an annual rate, several financial analysts said the country is already in recession.
It was this Monday when the National Institute of Statistics and Geography explained that for the third consecutive quarter the national Gross Domestic Product (GDP) contracted.
“Mexico is officially in a technical recession since the fourth quarter of 2018,” said Carlos Capistrán, chief economist at Bank Of America.
It should be noted that in the first two quarters of 2019, the Inegi reported that the economy’s declines were 0.09 and 0.06 percent.
“In the third quarter of 2019, the Gross Domestic Product (GDP) did not change compared to the previous quarter and had a real decrease of (-) 0.2% in its annual reference , ” said the institute.
Meanwhile, Alfredo Coutiño, director of Moody’s Analytics for Latin America, agreed with the fact that the country’s economy is in recession, as it has reported three consecutive quarters of contraction.
“If we apply the standard methodology at an international level, as it should be for purposes of comparative homogeneity, the Mexican economy is in recession by reporting not only two but three quarterly contractions or three annualized contractions, period,” he said.
In that sense, Gabriela Siller, director of Economic Analysis of Banco Base, reiterated that Mexico entered into a recessive phase.
“If we go to cyclic indicators, which show what phase the Mexican economy is in, they show that we are in a recessive phase,” he emphasized.
The analyst told the newspaper El Sol de México “that there is talk of a technical recession when there are two-quarters of a consecutive fall in GDP.”
Despite the aforementioned data, it is the Inegi who is responsible for determining, officially, if Mexico entered into an economic recession.
The Mazatlan Post