OECD raises growth forecast for Mexico to 3.3% in 2023

There Organization for Economic Cooperation and Development (OECD) increased its gross domestic product (GDP) growth projection by Mexico at 3.3 percent for this year, compared to 2.6 percent estimated last June when the OECD Economic Outlook was presented.

Likewise, he raised his forecasts by growth of the Mexican economy in 2024 at 2.5 percent by 2.1 percent.

This adjustment to national GDP projections comes against a backdrop of weak global economic growth and sharply falling general inflation, but with “persistent” underlying inflation forcing Central Banks around the world to maintain restrictive monetary policy.

The OECD predicts that the world is slowing down its economic growth to 3 percent, compared to 3.3 percent projected last June and considers that by 2024, global economies will record a decline of up to 2.7 percent, a figure lower than the 2.9 previously estimated.

In the case of UNITED STATESMexico’s largest trading partner, the OECD predicts that this country is growing at 2.2 percent in 2023 compared to 1.6 forecast last June. And for 2024, it estimates it will grow by 1.3 percent, just 0.3 percent more than its previous projection, leaving behind the specter of a recession.

The risks to growth, according to the international organization, will continue to be “uncertainty about the strength and speed of monetary policy transmission and persistence of inflation”.

The adverse effects of rising interest rates could prove greater than expected and persistent inflation would require additional policy adjustment that could reveal financial vulnerabilities.

He added that this is also a major risk for the Mondial economya sharper slowdown than expected in China, as this would affect global production growth.

Monetary policy remains restrictive until there are clear signs that underlying inflationary pressures have eased sustainably.

At the same time, the OECD recognizes that governments face growing budgetary pressures from rising debt burdens and additional spending linked to population aging, the climate transition and defense.

Therefore, he finally stated that “greater short-term efforts are needed to rebuild fiscal space and credible medium-term fiscal plans to better align short-term macroeconomic policies and help ensure the sustainability of the economy.” debt “.