Specialists see signs of economic cooling in Mexico

Specialists see signs of economic cooling in Mexico

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At the start of the administration headed by Andres Manuel Lopez Obrador, signals and warnings from analysts increased saying that there will be a cooling in economic activity in the coming months.

Jaime Reusche, an analyst at Moody's, warned that if negative market sentiment persists, business confidence, medium-term economic growth and investment prospects will be negatively affected, which could undermine fiscal strength and capacity.

Reusche stressed that after the cancellation of the New International Airport of Mexico City (NAIM), the reactions of financial markets have been present, so there is a risk that there will be a contagion of this negative sentiment among investors.

"The damage is already done. It will be very difficult to regain the trust of investors," Reusche warned.

Felipe Hernandez, economist for Mexico at Bloomberg Intelligence, pointed out that uncertainty is growing at the beginning of the new administration. "The growth of Mexico would remain moderate in 2019," he warned.

"The replacement of NAFTA reduced the risk of affecting trade; however, doubts about its implementation could affect private investment. In addition, the uncertainty about the economic policies of President Lopez Obrador, as well as the tight monetary conditions, could stop the [economic] growth," said the specialist.